Representation. A phone.
This is a representational image

As part of a significant restructuring intended to save expenses and boost efficiency, telecommunications company Telstra is reportedly planning to eliminate up to 2,800 positions, or 9% of its staff by the end of the year.

The majority of the job layoffs will come from Telstra's Enterprise segment, which offers large corporations communication services.

Telstra claims that because data on its mobile network is growing at a rate of 30% each year, the changes are required to be sustainable to satisfy the ever-increasing demands, Australian Associated Press reported. The business has promised that positions providing customer support to consumers would not be affected by job losses.

Telstra attributed the widespread employment layoffs to a difficult financial environment. Vicki Brady, CEO of Telstra, highlighted the strain that growing expenses were placing on the business, by saying, "This means we have to make significant ongoing investments in our infrastructure, our technology, and our services."

The layoffs, which could impact as much as 9% of Telstra's staff, coinciding with a halt in revenue growth. Expressing his viewpoint, telecommunications analyst Paul Budde said, "Revenue is flat — 1 per cent up, 1 per cent down on an annual basis — at the same time, costs are rising 10 per cent to 20 per cent over the last year alone. The truth is that telecommunications is a utility... at the same time, costs are rising," ABC reported.

Although the company recently revealed an increase in its half-yearly revenue and profitability, a deeper look reveals a more nuanced picture. Their 2023 Annual Report emphasizes the inherent risks and admits the limits in financial forecasts. This implies that Telstra may be dealing with issues that go beyond what the numbers in the headlines indicate.

James Perkins, national assistant secretary of the Communication Workers Union (CWU), expressed dismay at the sudden job layoffs, saying worker representatives were not given any notice.

He told ABC, "We were completely taken aback by this decision and felt completely uninformed." Perkins denounced the action, describing it as a "dangerous message" that puts money above people.

In response to concerns, Treasurer Jim Chalmers emphasized the necessity of maintaining services, and added the government would keep a close eye on Telstra's pricing policies.