Upsizing Joins Downsizing as AT&T Faces Music

By , Staff writer of The Christian Science Monitor

'Twenty years ago there was an invisible sign above the main door of AT&T's [New York] headquarters that read: JOB FOR LIFE," says Harold Burlingame, AT&T's senior vice president for human resources.

"Today," he continues, "when I go out into the field and meet with our employees, they ask me: 'What are you doing to train me so I can compete for a job over the next five years?' "

In a nutshell, that indicates a key change in corporate culture in the United States over the past 20 years.

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AT&T itself stands in the middle of a downsizing story as big as Niagara Falls, and it promises to roar on the political as well as the economic scene all year.

The former Ma Bell announced Jan. 2 it would shed 40,000 positions from its work force of 300,000 - 30,000 through layoffs - and split itself into three entirely separate companies - all supposedly by the end of the year. Since then, the payroll has dropped to 289,000, a cut of 11,000 jobs.

At the same time, AT&T is hiring rather vigorously in three areas - cellular (wireless communications), information technology systems, and Internet services.

So upsizing is going on at the same time as downsizing.

As much as possible, says a company spokesman, people are being transferred to these areas. But finding people who know or can learn the new technologies is a challenge, he says.

The churning at AT&T is a sure sign of great technological change in the US economy, says Ted Sienicki, director of sales and marketing for Probe Research Inc. of Cedar Knolls, N.J., a research firm specializing in telecommunications.

President Clinton last week held a Corporate Citizenship Conference in Washington, inviting 50 top US chief executive officers to encourage them from his bully pulpit to practice a new religion of corporate responsibility. Robert Allen, AT&T's CEO, was at the conference.

MR. Clinton is treading lightly in this area of worker anxiety. His strategists have decided he should avoid the appearance of inciting class warfare at a time when the economy is enjoying moderate growth, low inflation, and high employment. And the White House seems to have moved closer to the view that layoffs are sometimes necessary in today's global economy.

Yet two executives at Clinton's conference - Donald Hastings of Lincoln Electric Company in Cleveland, and Gerald Greenwald of UAL Corp. in Elk Grove, Ill. - stressed the responsibility of management to practice no-layoff policies through careful planning.

An AT&T spokesman said that such a policy is impossible in telecommunications because layoffs relate to both how fast technologies, such as area codes and voice recognition, are developed and how fast the public accepts them.

Another disagreement centers on whether the massive telecommunications bill that Clinton signed in February forced the current breakup of AT&T. Mr. Burlingame says the new law made the breakup "absolutely" necessary.

Kenneth Leon, a New York telecommunications analyst for the Chicago Corp., says the breakup reflected market forces.

Mr. Sienicki of Probe Research says the market forces of competition and technology actually drove the logic of the new law. This law allows regional phone companies and long-distance carriers to sell in one another's markets and gives all of them entree to selling TV service via phone lines or satellite.

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