Ericsson, a leading telecommunications company, has announced plans to lay off approximately 1,200 employees in Sweden. This move comes as the company faces a slowdown in demand for its 5G equipment. The company stated that the layoffs are part of a broader cost-cutting plan for this year, which will include additional efforts to boost efficiency.
Ericsson anticipates a challenging mobile networks market in 2024, with further volume contraction as customers remain cautious. In 2023, the company laid off 8,500 employees, or about 8% of its workforce, in an effort to lower costs.
Ericsson’s Cost Saving Initiatives
The company’s cost-saving initiatives cover various areas such as reduction of consultants, streamlining of processes, and reduced facilities. Ericsson has begun negotiations with unions regarding these measures. As of the end of 2023, Ericsson had 99,950 employees, including 10,744 workers in North America, according to a U.S. Securities and Exchange Commission filing.
An Ericsson spokesperson stated that the company aims to manage this process with fairness, respect, professionalism, and in line with the Collective Bargain Agreement and Swedish labor law.
Job Cuts Across the Tech Industry
Ericsson’s announcement comes as companies across the tech industry continue to slash jobs in large numbers. Since the start of the year, over 50,000 workers have been laid off from over 200 tech companies, according to Layoffs.fyi. In 2023, almost 1,200 tech companies let go of more than 260,000 workers.
Industry giants such as Alphabet, Amazon, Meta, and Microsoft have all contributed to the flurry of job cuts this year, along with companies including Cisco, DocuSign, Snap, and Zoom. These companies hope to raise profits through focused spending and efficiency fueled by artificial intelligence.
