Vodafone: mobile phone giant to cut 11,000 jobs over three years as UK unemployment rate rises again

Vodafone has announced plans to axe thousands of jobs as the UK unemployment rate rises once again.

The mobile phone giant’s new boss Margherita Della Valle has said 11,000 roles will be slashed over the next few years as part of a bid to improve performance and simplify the business. The cuts represent around a tenth of the company’s global workforce, and will affect both those based in its UK headquarters and those working for other markets worldwide.

It comes as unemployment has unexpectedly risen again in the UK, with economic uncertainty further weighing on the country’s job market. According to the Office for National Statistics (ONS), the rate of unemployment rose to 3.9% in the three months leading up to March, up from 3.8% in the previous quarter and marking the highest level since the three months leading up to January 2022.

Vacancies are also at the lowest level in 18 months, falling by 55,000 quarter on quarter to 1.08 million in the three months to April, marking the tenth fall in a row. The ONS said this reflects “uncertainty across industries, as survey respondents continue to cite economic pressures as a factor in holding back on recruitment”.

Commenting on Vodafone’s planned cuts, Ms Della Valle, who was appointed the group’s chief executive in January 2023, said: “Our performance has not been good enough. To consistently deliver, Vodafone must change. My priorities are customers, simplicity, and growth. We will simplify our organisation, cutting out complexity to regain our competitiveness.”

It comes as the mobile phone company reported a 1.3% drop in full-year earnings to a lower-than-expected £12.8 billion - with a forecast of little or no growth in earnings over the current financial year.

Vodafone’s former boss Nick Read, who was ousted abruptly in December 2022 due to concerns over the group’s performance, unveiled plans late last year to drive around £883 million in cost savings. The firm said at the time that this could lead to job losses but did not put a figure on the number of roles being cut.

Vodafone has around 12,000 staff across the UK, based in seven offices - including its headquarters in Newbury as well as other hubs in London, Manchester and Glasgow.

Earlier this year, the company also announced it would be cutting 1,000 jobs in Italy, following reports that full-time roles were to be axed in its biggest market in Germany which it said was “under pressure”.

Discussing rising unemployment, Darren Morgan, director of economic statistics at the ONS, said: “Employment and unemployment both rose again in the first three months of 2023, driven in particular by men.

“This means the number of those neither working nor looking for work continues to fall, although the number of people not working due to long-term sickness rose again, to a new record.” The figures, he said, indicate that while more people are returning to the jobs market, not all of those looking for jobs are able to find employment.

Mr Morgan also pointed out that “despite continued growth in pay”, people’s “average earnings are still being outstripped by rising prices.”

Meanwhile, UK Chancellor Jeremy Hunt said: “It’s encouraging that the unemployment rate remains historically low but difficulty in finding staff and rising prices are a worry for many families and businesses. That’s why we must stick to our plan to halve inflation and help families with the cost of living.”

The ONS data also laid bare the impact of strikes across the UK, with 556,000 working days lost due industrial action in March - an increase from 332,000 in February.