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Nortel cuts sure to hit city

<p>Nortel Networks representatives don’t know how many of the 2,100 companywide job cuts announced yesterday would hit Ottawa workers, but they do expect some of the 4,600 employees here to lose their jobs in the next year.</p>

Ottawa’s telecom giant paring 2,100 jobs


Nortel Networks representatives don’t know how many of the 2,100 companywide job cuts announced yesterday would hit Ottawa workers, but they do expect some of the 4,600 employees here to lose their jobs in the next year.



"We’re not breaking it down regionally, but a large number will be in North America," said Sami Asiri, a company spokesman working out of Ottawa. "And sadly, we expect some reductions in Ottawa."



The high-tech firm — which makes telecom equipment and employs 6,800 people in Canada — reported fourth-quarter losses of $844 million and announced yesterday it will cut 2,100 jobs and transfer 1,000 other jobs to lower-cost countries in 2008 and 2009, saving about $300 million annually.



Asiri said he didn’t know how the global cuts, designed to make operations more effective and competitive in the telecommunications market, will impact operations here and that the company hasn’t announced what positions it’s targeting.



But Jeffrey Dale, president and CEO of the Ottawa Centre for Research and Innovation, noted that Ottawa is Nortel’s single largest location in the world and that "for us to say we’re immune to it is not realistic."



But he thought Ottawa might avoid deep cuts because all of the company’s product lines are represented here.



Last February, Nortel announced that it would cut 2,900 jobs and transfer 1,000 jobs to other regions. In total, the company has cut more than 65,000 jobs since 2001. This round of cuts was unexpected, Dale said.



Nortel would not release the number of Ottawa jobs lost in the last cut, calling it an internal matter. As for future job cuts, Asiri said, "we certainly hope that no further reduction will be necessarily."



Growth is very slow for everybody and it’s not going to get any better any time soon, said Ed Snyder, principal analyst at Charter Equity Research. "The workforce reduction is going to be necessary," he said. –WITH FILES FROM REUTERS





















Ottawa’s anchor




  • Ottawa continues to see the growth of its high-tech industry come from small and medium-sized companies, a trend that has been holding steady for several years, said Jeffrey Dale. Still, the city needs anchor companies like Nortel for a vibrant economy, he added.


 
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