WORKER IMPACT : Impact on Jobs Is Expected to Be Modest
When big American corporations merge, it’s normally standard procedure for the architects of the deal to squeeze out costs by slashing jobs furiously at one or both of the companies.
But company and union officials expressed hope Monday that St. Louis-based SBC Communications’ $16.7-billion agreement to acquire Pacific Telesis Group, parent of Pacific Bell, will break that pattern--and result in no more than modest cutbacks.
In fact, in California the merger partners pledged to offset some of the expected cuts by creating at least 1,000 new jobs. Those jobs would come through the establishment in the state of a headquarters for the two companies’ combined long-distance, international and Internet operations.
“This historic merger is about growth--growth in jobs, markets and services to our customers,” said Edward E. Whitacre Jr., chairman and chief executive of SBC, in a prepared statement. “It is not about downsizings or reduced employment opportunities.”
Union leaders, meanwhile, “have no reason not to put faith in [the two companies’] words,” said Jeffrey Miller, a spokesman in Washington for the Communications Workers of America. “We have good relations with both of these companies.”
The CWA represents 39,000 workers at SBC and 32,000 at Pacific Telesis. Including management staff, the two companies employ 108,000 people.
To be sure, part of the reason that cutbacks may be modest is that thousands of jobs already have been eliminated at all of the so-called Baby Bell telephone companies. Although the cuts have been relatively light at SBC’s Southwestern Bell system, Pacific Bell is in the midst of a 10,000-job cutback over four years that was announced in January 1994.
Pacific Telesis spokesmen said Monday that 6,000 of those jobs already have been eliminated, and that the remaining 4,000 still are expected to be cut, even as the 1,000 new jobs are created at the California long-distance, international and Internet headquarters.
Management consultants say further merger-related cuts are likely at the companies’ headquarters, involving legal, finance, accounting, training information systems and even senior management positions. “You’ll see retirements of officers at both companies very quickly now,” said Jagdish N. Sheth, a telecommunications consultant and marketing professor at Emory University in Atlanta.
In fact, Sheth said some of the departures will help clear the way for a new generation of employees at all levels of the business to bring the merged company into a new technological era.
Still, these consultants said San Francisco-based Pacific Telesis-- regarded as far more innovative technologically than SBC--is likely to be spared other significant reductions. “I can’t imagine they’d come in and cut down the future services efforts already underway” at Pacific Telesis, said Bill Davidson, a telecommunications consultant and a management professor at USC.
Also, in the union ranks at Pacific Telesis, there is hope that layoffs will be avoided. A CWA spokesman said Pacific Telesis has lived up to an agreement reached with the union in 1986 to achieve cutbacks through normal attrition and other “voluntary” means.
At the Pacific Bell building at 1010 Wilshire in downtown Los Angeles, a marketing and sales facility, the mood among many employees was upbeat, while others took a wait-and-see attitude.
“The people at Southwest Bell do the same jobs we handle here--but they do it in a different state,” said Bill Turner, an account manager in marketing, explaining why he doesn’t think his facility will suffer job losses.
Rene Woods, a service representative, said, “A merger would be good because--from what I hear--SBC is a large company and we would be stronger for it.”
