Verizon, the largest mobile carrier in the U.S., has announced plans to lay off nearly 5,000 employees as part of its ongoing restructuring efforts. The telecom giant expects around 4,800 workers, roughly 4.5% of its workforce, to depart by March 2024. Half of those affected will leave by September, with the remaining employees exiting by early next year.
The cuts follow Verizon’s voluntary separation program, launched in June, aimed at U.S.-based management positions. This program is part of broader cost-cutting measures to streamline operations as the company adapts to challenging economic conditions, including rising inflation and interest rates.
Financial Impact of Layoffs
Verizon will incur a significant financial impact from these layoffs, including a pre-tax write-off of up to $1.9 billion in severance pay during the third quarter. The company is also expected to take pre-tax charges of between $230 million and $380 million related to its decision to cease using certain real estate assets and exit non-strategic business areas.
These moves reflect a broader restructuring within Verizon, as the company aims to optimize its operations and shed excess resources that are no longer aligned with its strategic goals.
Part of a Broader Tech Layoff Trend
Verizon’s layoffs come amid a wave of tech industry downsizing in 2024. Globally, more than 137,000 tech jobs have been lost this year, affecting major players like Microsoft, Apple, IBM, Cisco, Dell, and Intel. Many companies in the sector are adjusting their workforce after over-expanding during the pandemic, when the surge in remote work led to higher demand for tech services.
Now, faced with a cooling economy, tech firms are trimming excess staff to align with more sustainable levels of consumer demand. Economic pressures, particularly high inflation and interest rate hikes, have also contributed to decreased spending and sluggish growth across industries, forcing companies like Verizon to make difficult cost-saving decisions.
Future Steps for Verizon
As Verizon continues its restructuring, the company is expected to focus on key growth areas and strategic realignments. The telecom giant has already signaled plans to exit certain non-core businesses and consolidate its operations to improve efficiency. With ongoing investments in 5G infrastructure and digital services, Verizon aims to position itself for long-term growth despite the near-term challenges.
Verizon’s workforce reductions, while challenging, are part of a broader effort to remain competitive in a rapidly changing market, balancing cost-cutting with innovation and investment in new technologies.
