Ericsson to cut up to 1,600 job losses in Sweden amid global cost-cutting drive

Up to 1,600 roles in Ericsson in Sweden could be lost as part of a wider programme to icontrol the company’s global costs

The plan is one of the most significant potential workforce reductions in its home market in recent years.

In a statement issued today (January 15), the telecoms equipment giant said it had submitted a formal notice to the Swedish Public Employment Service and had begun negotiations with relevant trade unions.

The proposed staff reduction forms part of global initiatives designed to increase operational efficiency while continuing to invest in areas it sees critical to long-term competitiveness.

Ericsson said it remains committed to maintaining its technology leadership and to executing its strategy to deliver “high-performing, programmable networks” that enable differentiated services and new monetisation opportunities for customers.

The company added that efficiency initiatives will continue across the Group, but that further measures will not be announced separately.

Pressure on margins

Network operators across Europe and other mature markets have slowed capital expenditure on 5G rollouts. This has put pressure on vendors’ revenues and margins. Inflation, higher interest rates and ongoing geopolitical uncertainty have forced operators to scrutinise spending,

Ericsson has been simplify its operations and reduce costs for several years. The company has warned of subdued investment from communications service providers, especially in North America, which has historically been one of its strongest regions.

Competition has also intensified, both from rivals and from lower-cost China vendors, queezing pricing in key product categories. Ericsson has emphasised software, programmable networks and services that promise higher margins and longer-term growth as it looks to reduce its overall cost base.

Impact

Ericsson is one of Sweden’s main technology employers Job losses in Sweden will attract close attention from both policymakers and trade unions. A breakdown of which functions or locations may be affected, have not been revealed but discussions with unions are now under way.

Ericsson intends to balance cost reductions with continued investment in advanced network technologies that support automation, enterprise use cases and new revenue streams,.

The announcement says the cull is part of an ongoing efficiency programme rather than a standalone restructuring