Ericsson workers keener than expected for voluntary redundancy

When times are tough you take the wins where you can and it turns out that Ericsson is pretty handy when it comes to downsizing.

In an announcement entitled ‘Update on cost and efficiency program’ Ericsson declared the plan to reduce its headcount in Sweden by 3,000 is progressing ahead of plan.

The reductions have been sought through a combination of a voluntary reduction program, reduction of production in Sweden, outsourcing and natural attrition so, for things to be progressing ahead of schedule the chances are it’s the voluntary redundancy scheme that is the cause.

And so it is. It looks like, if anything, demand for voluntary redundancies had exceeded supply, with all 1,600 opportunities snapped up by Swedes looking for a bit of well-earned subsidised chilling. As a consequence Ericsson has added an extra 1.5 billion Krona (~$150 million) to its restructuring bill for 2016, implying that even if as much as 1,000 of the settlements were ahead of schedule they’re averaging $150,000 per head. Nice work if you can get it.

Ericsson says the 2017 restructuring bill will be smaller as a consequence but hasn’t committed to a figure. While the swedish round is now completed the global downsizing program continues and Ericsson says it’s still on track to get annual operating expenses down to SEK 53 billion (not including all these hefty pay-offs) by the second half of next year.