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News > Companies
Tellabs cuts 1,000 jobs
August 22, 2001: 12:21 p.m. ET

Latest job cut by a telecom equipment maker affects 13% of work force
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NEW YORK (CNNfn) - Tellabs Inc. became the latest telecom equipment maker to slash staff in response to slowing purchases by customers, as it announced Wednesday it will eliminate 1,000 jobs, or about 13 percent of its worldwide work force.

About 700 of the layoffs will be in the United States and an additional 50 people have taken early retirement offers here. No U.S. facility is being closed, but the company said it will discontinue plans to open an office building in Chelmsford, Mass.

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The company is shutting a plant in Drogheda, Ireland, which employs 204 people. About 55 of those jobs will be relocated to a facility in Shannon, Ireland, and other work will be transferred to a plant in Espoo, Finland. Most of the remaining job cuts will come from elsewhere in Europe.

The company expects to take a $50 million restructuring charge in the third quarter. It said these staff cuts and earlier cost-cutting efforts are designed to reduce operating expenses by 5 percent by the fourth quarter, and should produce $120 million in annual savings.

"As customers continue to reduce capital spending, we have less work for employees and must take difficult steps to preserve Tellabs' long-term health," CEO Richard C. Notebaert said.

Tellabs is just the latest telecom equipment maker to cut staff. The telecom sector, which includes equipment makers, has seen 175,350 job cuts in the first seven months of this year in the United States or worldwide by U.S companies, according to data compiled by outplacement services provider Challenger Gray & Christmas. That makes telecom the sector most hit by job cuts so far this year.

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The plant closing in Ireland also is not unique. The country, which had seen a boom in technology jobs in recent years, has been hit by a series of tech plant closings in recent weeks, including personal computer maker Gateway Inc. (GTW: down $0.04 to $9.96, Research, Estimates), which is eliminating 900 jobs by shutting down its Irish operations; General Semiconductor Inc. (SEM: up $0.01 to $12.26, Research, Estimates), which is closing a plant in Cork employing 670 people; and Internet security software maker Baltimore Technologies PLC (BALT: unchanged at $0.67, Research, Estimates), which just announced it will cut at least 600 jobs on top of 250 cuts it announced in May. graphic


-- Reuters contributed to this report

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Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer LIBOR Warning: Neither BBA Enterprises Limited, nor the BBA LIBOR Contributor Banks, nor Reuters, can be held liable for any irregularity or inaccuracy of BBA LIBOR. Disclaimer. Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.