Sprint, T Mobile Merger Forces Layoffs; 30,000 Job Cuts Expected

The $26 billion merger between Sprint Corporation and T-Mobile U.S. Inc, which was given the judicial go-ahead February 11, is expected to result in massive employee layoffs and that number now translates into 30,000 jobs.

The Communications Workers of America (CWA), the largest communications and media labor union in the United States with about 700,000 members, said the merger "will put 30,000 jobs at risk." It expects majority of the cuts to happen after the merger is completed on April 1.

T-Mobile already "has laid off a number of employees" in its prepaid business, Metro by T-Mobile, but "the extent of the layoffs is unclear," Light Reading reported. One of CWA's reports said 11,800 prepaid jobs at T-Mobile and Sprint stand to be eliminated. Another 13,700 jobs in the both companies' postpaid businesses and 4,500 at their headquarters may be axed.

T-Mobile and Sprint "both have long track records of offshoring U.S. jobs," said CWA. The analysis was conducted before the merger plan was altered to divest Sprint's prepaid business to Dish Network. This move might reduce the number of layoffs, Arstechnica noted.

"Wall Street analysts project that the merger will result in massive job cuts from the elimination of duplicative retail stores," CWA wrote in its analysis. "When pressed on the issue at a Senate hearing (in June 2018), T-Mobile CEO John Legere admitted 'there'll be a rationalization of jobs in the first year' -- a corporate-speak admission that the merged company plans to lay off thousands of workers."

T-Mobile employed more than 53,000 part- and full-time employees in 2019 compared to 52,000 in 2018. Sprint had 29,000 employees at the start of 2019.

CWA said it has an idea of what's going to occur when the inevitable layoffs occur. It noted T-Mobile's acquisition of iWireless, a regional carrier in Iowa, in January 2018 illustrates what will happen to jobs when T-Mobile takes over.

It said T-Mobile closed more than 72% of iWireless corporate stores and more than 93% of authorized dealer stores. T-Mobile also shut down iWireless customer call centers in Des Moines and Cedar Rapids, Iowa. T-Mobile will then take aim at independent stores.

Sprint is America's third largest wireless carrier and T-Mobile the fourth. The other two carriers are number one Verizon Communications Inc. and number two AT&T Inc. Sprint and T-Mobile contend the merger is necessary to help them install 5G mobile technology nationwide. The merger will also allow them to better compete against Verizon Inc and AT&T.