French, US telecom giant to cut 10,000 jobs in 2 years

The French-American telecom giant Alcatel-Lucent (ALU) has announced plans to cut an overall 10,000 jobs worldwide over the next two years.
ALU announced on Tuesday that it intends to axe nearly one in seven of its employees, with 900 job cuts in France next year and more than 4,000 in Europe, the Middle East and Africa by 2015.

Additionally, another 6,000 employees will lose their jobs in the Asia Pacific region and in North and South America.

This is while, demonstrators gathered in Orvault, western France, to protest in front of the ALU plant after the group announced the massive job cuts.

The layoffs are the last chance effort for the company to turn around heavy losses and to reduce its fixed costs by 15 percent.

“Everyone knows this plan is the last chance. The company is in a very serious situation,” said Chief Executive Michel Combes.

The French-US telecom-equipment maker posted a loss of 885 million euros in the first half of this year.

ALU has been forced to repeatedly announce sharp reductions of its workforce in the past few years, following the merger of Alcatel and Lucent in 2006.

Over the past year, big French companies like Peugeot Citroen, Alcatel, and Sanofi announced thousands of job cuts.

Meanwhile, due to the ongoing financial crisis in France, many other people working for small and medium enterprises were also dismissed.

France is one of a few rich-world economies with a double-digit unemployment rate, others being eurozone members Spain and Italy, along with South Africa.

In an attempt to lower the country’s huge debt load, the French government has increased taxes and implemented several reforms and spending cuts. However, the measures have proven unproductive since the financial crisis in the eurozone has not been resolved and the euro area is still bogged down in recession.

Europe plunged into a financial crisis in early 2008. The worsening debt crisis has forced the EU governments to adopt harsh austerity measures and tough economic reforms.