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May 18, 2023

BT plans 55,000 job cuts and will replace staff with AI

The telco is adopting a leaner way of working, with roles being axed and many replaced by automated systems.

By Matthew Gooding

BT says it will axe 55,000 staff by the end of the decade, and plans to replace up to a fifth of the roles with AI.

BT has announced big job cuts this morning. (Photo by William Barton/Shutterstock)

The news came as the telco announced its annual financial results, which showed a 12% dip in profits, to £1.7bn. It employs 130,000 staff and contractors around the world, and wants to reduce this number to 75,000-90,000 by 2030.

BT redundancies: most layoffs in the UK as telco embraces AI

Announcing the news this morning, BT CEO Philip Jansen said that the roll-out of 5G and fibre broadband services in the UK will come to an end in the next few years, and this business segment is likely to bear the brunt of the job cuts.

“By continuing to build and connect like fury, digitise the way we work and simplify our structure, by the end of the 2020s BT Group will rely on a much smaller workforce and a significantly reduced cost base,” Jansen said. “New BT Group will be a leaner business with a brighter future.”

Speaking to investors on the company’s earnings call, Jansen said he expects AI to be able to pick up some of the slack and replace up to 10,000 of the axed roles. The rise of ChatGPT and other generative AI tools over recent months is likely to have a profound impact on many business sectors, with tasks being automated that were previously carried out by human staff.

“For a company like BT there is a huge opportunity to use AI to be more efficient,” Jansen said. “There is a 10,000 reduction [in staff] from that sort of automated digitisation, we will be a huge beneficiary of AI.” He added: “I believe generative AI is a huge leap forward, yes we have to be careful, but it is a massive change.”

More layoffs in the telecoms sector

BT is the latest company to reveal it will deploy AI as part of plans to cut its workforce. Earlier this month, IBM revealed it was pausing hiring for 7,800 back office roles which it believes could be replaced by artificial intelligence systems.

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The news of the BT job cuts comes days after another UK telco, Vodafone, said it was making 11,000 staff redundant over the next three years.

Vodafone said the move was in response to difficult market conditions, which saw its income remain static and its cash reserves fall. In comments similar to those of Jansen, Vodafone’s new CEO Margherita Della Valle said her company must change and embrace a leaner way of working.

“Our performance has not been good enough,” Della Valle said. “To consistently deliver, Vodafone must change. My priorities are customers, simplicity and growth. We will simplify our organisation, cutting out complexity to regain our competitiveness.”

Read more: Is the telecoms industry really in freefall?

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