Ericsson to reduce North America workforce by 10 per cent

Ericsson is set to cut up to 10 per cent of its 15,000 workforce in North America, as it looks to ensure it has “the best people, with the right competencies, in the right places.”

The company has seen its workforce in the region swell in recent years, following its acquisition of CDMA and LTE assets from Nortel Networks – a transaction that saw more than 2,500 staff join Ericsson. It has also signed a number of high-profile deals, including the contract to manage Sprint’s mobile network – which saw 6,000 staff moving companies.

For the full year 2011, Ericsson reported sales of SEK48.8 billion (US$7.17 billion) for its North America business unit, down one per cent year-on-year. It was one of the company’s poorest performing regions in terms of year-on-year sales growth, after Southeast Asia and Oceania (seven per cent sales decline) and Western and Central Europe (four per cent drop).

North America represented around 22 per cent of Ericsson’s total sales during this period.

This decline was attributed to a drop-off in network infrastructure sales, while its services and multimedia businesses “developed favourably.” It was noted that sales slowed in the latter part of the year following an earlier period of network capacity building, and CDMA sales also declined due to the “rapid shift to LTE.”