Ericsson Cuts 1,400 Jobs in Sweden; Global Layoffs Expected

Telecom giant Ericsson is shedding 1,400 of its jobs in Sweden as part of an agreement reached with trade unions in that country. The company plans to reduce headcount through a voluntary program, reports Telecoms.com, a publication owned by Channel Futures’ parent company Informa.

The job cuts account for 10% of Ericsson’s employee base in Sweden. It’s part of efforts to reduce costs by about $861 million by the end of 2023. The organization also plans to minimize the number of consultants, streamline processes and reduce facilities.

“Reducing headcount is never easy, and we will manage this with the utmost respect and professionalism,” a spokesperson for the company said. “Further details are always communicated to the relevant staff first.”

These may not be the only headcount reductions Ericsson plans to initiate. The company, which has more than 100,000 employees, is likely to cut thousands of jobs in additional countries in the days ahead, according to Reuters.

Financial Setbacks

Telecoms.com is also reporting that a slowing global RAN (radio access network) market is having significant influence on networks. This is a major business for Ericsson. Although the company bought Vonage in a significant deal last year, enterprise accounts for only 6% of Ericsson’s revenue. Compare that to networks, comprising 71%, or $26 billion, in revenue in 2022.

Additionally, the Wall Street Journal reports that Ericsson had lower-than-expected quarterly profit last month. The company faced an “uncertain” start to the year. Telecom operators in the U.S. and elsewhere are waiting to place new orders for 5G gear.