British Telecommunications Group plc, which trades as BT, said it would slash 10,000 jobs by year-end with pre-tax profits tumbling 11 per cent in the first six months of the year. The surprise announcement by the former state-owned telecoms operator will see as many as 15,000 UK jobs disappearing over the past three days.
BT's announcement follows hard on the heels of similar announcements by Virgin Media, Yell and GlaxoSmithKline over the preceding days.
Ian Livingston, chief executive of BT, described the action as "decisive".
Only yesterday, data from the Office of National Statistics revealed that British unemployment had hit an 11-year high of 1.82 million in the three months to September.
Also yesterday, Mervyn King, governor of the Bank of England, finally acknowledged that the UK was heading for a full-blown recession and hinted of further interest rate cuts, over and above the 1.5 per cent cut announced last week.
BT said most of the job losses would be among contract, agency and offshore workers along with sub-contractors and other indirect employees. The losses add to the 4,000 jobs already slashed by the telecoms operator.
The job losses would be complete by the end of its current financial year in March, the telecoms group said.
Pre-tax profits in the six months to 30 September, before specific items, fell 11 per cent to £590 million on sales which were up 4 per cent, at £5.3 billion. BT said its performance was "disappointing" and pointed at its struggling Global Services division where earnings before interest, tax, depreciation and amortisation fell by 36 per cent to £119 million.
BT operates as four divisions and said that three of them were functioning smoothly. It indicated that the Global Services division lagged in performance due to tardy cost-cuts, a decline in earnings from more profitable business lines and also from the effects of the falling pound.
BT is also battling against huge liabilities in its pension fund, which is among the largest in the country.
Last week, it began consultations on a deal that would involve staff contributing more and continuing to work until they were 65.
The current retirement age is 60.