The British telecom giant has announced that around 11000 jobs will be cut globally over the next three years. Former CEO Nick Read resigned after his four-year tenure saw a 40 per cent decline in market value, and Margherita Della Valle replaced him to revive the company’s financial strength.
Vodafone’s new CEO decided to layoff staff after the company’s share price hit a two-decade low. She said that the company’s performance is not “good enough” and to “deliver”, “Vodafone must change”. This decision is part of cost-cutting.
Valle added, “My priorities are customers, simplicity and growth. We will simplify our organisation, cutting out complexity to regain our competitiveness. We will reallocate resources to deliver the quality service our customers expect, and drive further growth from the unique position of Vodafone Business”.
It’s reportedly the highest layoff in the tech giant’s history. This layoff will cut around 10 per cent of the total global workforce.
Last year in November 2022, the company announced its cost-cutting plan, which included job cuts, to address rising energy bills and inflation. Earlier this year, 1000 employees were relieved in Italy and are expected to layoff 1300 in Germany.
The company has underperformed financially and registered a decline of 1.3 per cent in group core earnings, around 4.7 billion euros. The group’s core earnings for the year to the end of March is 14.7 billion euros. This financial decline is because of the competition faced by rivals such as AT&T and Verizon.
The company’s action plan is to tackle its financial decline is centred around these priorities: a significant investment in customer experience and brand, 11,000 job cuts scheduled over three years, a turnaround plan for Germany, reassessing their pricing, and a strategic assessment in Spain.
For its United Kingdom operations, Vodafone is planning to merge with rival three UK, owned by CK Hutchison.
This layoff season is continuing in full swing. This year, in March, Amazon C.E.O. Andy Jassy announced that the company would layoff 9,000 employees due to the uncertain economic landscape.
Another tech giant, Meta, Facebook’s parent company, will cut down 10,000 jobs in the coming months for restructuring. Even Senior Meta India executive Manish Chopra announced his resignation on May 16 through LinkedIn; it was the fourth major exit in 6 months. In January, Google announced that it would layoff over 12,000 employees.
It is pertinent to note that various companies have laid off significant workforce to restructure their organisations and cut down costs amid the recession, mainly attributed as an after-effect of the COVID pandemic. The layoffs have affected thousands around the world.
