AT&T To Cut 12,000 Jobs

December 4, 2008 6:26 p.m. EST

Dallas, TX (AHN) - AT&T Inc. announced Thursday it will cut 12,000 jobs, roughly 4 percent of its staff as the company looks to streamline its organizational structure with landline business steadily dropping.

The nation's largest telecom company said the cuts will begin this month and continue throughout 2009. The cuts will result in a $600 million charge that AT&T plans to take in the fourth quarter of 2008.

"While AT&T is reducing jobs in some areas, it continues to add jobs in other parts of the business - such as wireless, video and broadband - to meet customer demand," the company said in a statement.

AT&T announced a 4,600 job reduction back in April but continued to add jobs in other areas of its business, never really seeing a decline in total headcount. However, the company did say that its total workforce would shrink on this cut.

AT&T also said it will reduce its capital spending in 2009 from 2008 levels and will provided specific guidance when it releases fourth quarter results in January.

The company said some hiring will be done in 2009 for the cell phone and internet units as it adjusts to the trend of growing wireless business and declining landlines business.

Shares of AT&T fell 3 percent on Thursday to $28.18.