WorldCom targets 5,000 jobs

Last week, WorldCom announced the first milestone in CEO Michael Capellas’ 100-day company rejuvenation plan: 5,000 job cuts. The carrier says it is in the process of reducing costs that will total $2.5 billion.

WorldCom plans to cut line costs by 12.5%, and reduce sales, general and administrative expenses by 13%. The cost cutting measures will be achieved by a number of ways.

In addition to the thousands of employees that have been let go since last year, WorldCom says 5,000 more will be laid off. The carrier also says that none of these positions will be from its “quota-bearing sales force or essential operations and technology functions.”

The company is also cutting costs by better integrating networks, deploying improved technologies and renegotiating 2,600 supplier contracts.

WorldCom is also consolidating its facilities by 26% as a result of selling several buildings and land. The carrier says it will maintain a strong presence in these cities: Alpharetta, Ga., Ashburn, Va., Cary, NC, Clinton, Miss., Denver and Colorado Springs, Colo., Hong Kong, Reading, U.K., Richardson, Texas, and Tulsa, Okla. Other offices around the world will be maintained.

Capellas says these cost cutting measures are necessary to see WorldCom emerge from Chapter 11 bankruptcy proceedings, planned for mid-2003.