While stock prices soar, workers fall 40,000 jobs at AT&T just another casualty of age of downsizing

January 07, 1996|By C. Fraser Smith

IF A TIDAL WAVE swept across South Florida, knocking down power lines, closing streets and washing out businesses -- disrupting the lives of 40,000 people -- many would call it a disaster.

When the boss of AT&T or Westinghouse or IBM or some other huge corporation takes an ax to the work force -- which is happening with increasing regularity -- we call it downsizing, restructuring or repositioning.

So soothing is the language of layoffs that the stunned victims often make no audible outcry. The momentarily unaffected are similarly silent. At least they have the distinction of a sociological label: "The Anxious Class."

More attention is paid to a partial and temporary shutdown of the federal government than to the broad swath and continuing pace of ineradicable job loss in the American workplace. No marathon meetings between the president and congressional leaders on this matter. No talk of having that issue decided in the coming presidential campaign.

President Clinton last week defined the Washington stalemate over balancing the budget as an "unnatural disaster" caused by the Republicans. Cynical, he called it. And the Republicans replied in kind.

But what sort of disaster is causing this weeding out of American workers? Are the workers' losses of income and economic security natural or unnatural, planned or unplanned, deliberate or unavoidable?

In the past, American workers fell with the economy and rose with it. Now they're falling while the stock market booms. And today's victims of the corporate monsoon are being told not even to think about getting their old jobs back.

AT&T does what it needs

Last week, AT&T announced it would reduce its work force by 40,000 so it could be competitive in the new telecommunications environment. Analysts said the company had done just what it needed to do to stay in the telephone company ball game.

With similar reductions promised by other communications giants, the managers, operators and service workers at AT&T and elsewhere must wonder if James Earl Jones will be the last human being on the phone company's payroll -- not in body, of course, but in the form of his recorded voice.

A 29-year-old father with five years' experience at the Bell Atlantic information center in Cumberland wonders when the bad news will come for him. He can hardly miss the message implicit in his reduced duties:

"After you ask for your information, we key in the request and kick it back out. All we say is 'Thank you'," said an operator who identified himself only as Kirk -- company policy would not allow him to give his last name, he said.

Welcome to the phone company's version of the nearly workerless factory.

Last week's news came as no surprise to Kirk or to the dwindling membership of Communications Workers of America Local 2101 Baltimore. Only 35 to 50 AT&T workers remain on that local's rolls.

"There was a time when we had between 400 and 500 of their people, but since 1984 they've been continually downsizing," said Charles D. Bates Jr., the local president. Overall, the local's membership is down to 1,775, off by 1,000 from 2,700 in 1987.

The communications workers' union leadership in Washington believes its share of the force reductions announced last week by AT&T will be only about 30 percent, but it has no details.

"We've been in meetings with them since they announced they were splitting up [into three new companies] months ago," said Jeff Miller, a CWA spokesman in the Washington headquarters.

Some layoffs were expected, he said, "but we had no advance notice of this. The general thinking was it would be about half the size of what it announced, about 20,000. We don't know why it was so much bigger."

What happened at AT&T is a perversity from the workers' viewpoint.

"It used to be a shameful thing to have a big layoff. It was viewed as a management failure," Mr. Miller said.

For the long distance company's shareholders, though, the move was a virtuous and profitable one. The value of their stock punched up almost three points per share on the strength of what must have been regarded as management savvy and efficiency. Lean and mean is in on Wall Street.

But what does it say about a company that admits, more or less, that it has been carrying a payroll of 40,000 workers it didn't need? How long, a stockholder might wonder, had this been going on?

Telecommunications industry analysts such as Michael J. Balhoff Legg Mason Wood Walker of Baltimore say the answer lies in the realms of history and technological development:

"The simplest explanation is that we're going from a monopoly to a highly competitive environment. AT&T has been operating in a competitive environment since 1984, but it's not purely competitive yet. Vestiges of the old monopoly remain."

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