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Why it matters: The merger of gigantic companies usually results in job losses. At $26 billion, T-Mobile’s merging with Sprint was one of the largest, but the former promised it would create new jobs, not eliminate them. According to a recent report, however, the newly combined company has fewer people working for it now than before the merger.
The Wall Street Journal has revealed that T-Mobile had 75,000 full-time and part-time equivalent workers at the end of 2020, around 5,000 fewer than when the merger with Sprint was finalized. The figures make its previous promise sound a little hollow: “This merger is all about creating new, high-quality, high-paying jobs, and the New T-Mobile will be jobs-positive from Day One and every day thereafter,” said former CEO John Legere in 2019. “That’s not just a promise. That’s not just a commitment. It’s a fact.”
T-Mobile recently decided to shut down the TVision television channel it started in November, telling employees who still wanted to work in the TV industry that they would need to look elsewhere. While the pandemic has been responsible for many job losses across the world, wireless executives told the Journal that reducing staff was always part of the plan; Covid-19 just sped up the process.
T-Mobile’s current CEO, Mike Sievert, said that the company has 6,000 open positions it plans to fill as the economy recovers. T-Mobile also promised to add another 11,000 jobs by 2024. But given the falling employee numbers, it’s easy to look at those claims with a heavy dose of skepticism.
The report states that the number of people employed in the telecommunications sector has crashed from a peak of 1.5 million in 2001 to 690,000 today, with many of the jobs having been outsourced. But it’s worth noting that outside contractors aren’t included in US Labor Department figures.
One person who walked away happy from the merger is Legere. The ex-CEO left with a $136 million severance package on the day it was completed.
Image credit: m_sovinskii
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