WorldCom Announces $2.5 billion In Cuts, Another 5,000 Jobs To Be Eliminated


WorldCom announced $2.5 billion in cuts Monday, including the elimination of 5,000 jobs, as part of the telecommunication company's plan to emerge from bankruptcy in April.

The cuts, which include 8 percent of WorldCom's workforce, are the first major moves by new chairman and CEO Michael Capellas. Details on which jobs will be cut were not released.

The savings will come by consolidating facilities, though the company said it will maintain all its major offices, including its Clinton headquarters. Industry analysts have expected WorldCom, whose MCI unit remains the No. 2 long-distance carrier, to close some business units.

WorldCom, which is losing about $200 million a month, has been trying to cut costs by asking the bankruptcy court to let it vacate leases and renegotiate or get out of some supplier contracts.

WorldCom has about 60,000 employees after cutting 20,700 positions last year following the largest bankruptcy filing in U.S. history amid a $9 billion accounting scandal that led to the resignations of founder and former CEO Bernard Ebbers and chief financial office Scott Sullivan.

The company is being investigated by the Justice Department and Securities and Exchange Commission.