Sponsored By

Headcount: More Cuts ComingHeadcount: More Cuts Coming

The recession ain't really over, Ciena and Cisco keep cutting, and Metro-Optix sells itself, post mortem

September 9, 2003

4 Min Read
Headcount: More Cuts Coming

The recession may be "officially" over (like the war in Iraq), but companies in and out of telecom are still slashing jobs with wild abandon.

In August, employers slashed payrolls in the U.S. at their fastest rate since March, according to the latest figures from the Labor Department. U.S. employers cut roughly 93,000 workers from their payrolls during the month, the seventh consecutive month of reductions. The news took many economists by surprise, as they had been expecting the opposite.

The news was no surprise to telecom workers, many of whom are still getting pink slips as we speak. Or type. Or read. Whatever...

Anyway, it's time to have a look at some of the most interesting hirings and firings of the last several days:

  • Despite efforts to keep its downsizing on the down-low, Ciena Corp. (Nasdaq: CIEN) says it has cut another 280 employees. Aaron Graham, a Ciena spokesman, says the cuts happened on Wednesday and were made across all departments. The company ended the third quarter of fiscal 2003 with 2,024 employees, but word on the street is that at least 150 jobs were cut from the company’s research and development facility in the San Francisco Bay Area, which it acquired when it bought ONI Systems. Graham would not comment on specifics.

    • Ciena isn’t the only company trying to keep its continuous cuts quiet. Cisco Systems Inc. (Nasdaq: CSCO) eliminates hundreds of jobs every quarter in an effort to shed under-performing employees. Even though it’s eliminated more than 2,000 jobs since February 2002, it still maintains that it has not had any significant layoffs. Cisco’s headcount, as of the end of July, is 34,466.

      • Procket’s interim CEO, Paul Matteucci, has finally gotten down to business. Last week, the company cut around 13 percent of its workforce, according to Matteucci. He said cuts were distributed throughout the company with no single area being affected more than another. While some claim that this is only the first in a series of layoffs, Matteucci says he doesn't predict any further staffing reductions.

        "Procket is currently at the employement level we want going forward, and one that we believe is sustainable in the current environment," he wrote in an email to Light Reading. "If we perform as expected, we would expect to grow our workforce, not to shrink it."

        The company’s last staff reduction was in May, leaving the company with 265 employees (see Headcount: Viva la Cinco de Mayo!). Company officials did not return calls for comment on this story. But considering that many of them had left the company before the cuts, it’s little surprise.

        Matteucci took over in June after the former CEO, Randall Kruep, left (see Procket CEO Resigns). With a burn rate rumored to be $5 million to $6 million per month, Matteucci has his work cutting workers cut out for him (see Procket Plows On). But he claims that headcount reductions are only a small part of the company's strategy for slashing its burn rate.

Subscribe and receive the latest news from the industry.
Join 62,000+ members. Yes it's completely free.

You May Also Like