Nokia's New Business Model: 10K Employees To Lose Jobs

Helsinki: Nokia, the tech giant in the field of wireless networking, has made a sensational decision. Nokia has announced that it would lay off 10,000 employees.

Nokia is planning major job cuts from 2021 through 2022. The communications and network equipment provider plans to shift spending from general areas to more R&D (research and development).

Nokia CEO Pekka Lundmark, on the job for a year, is striving to bolster the company for 5G wireless network contract bids and deployments Vs. rivals Ericsson and Huawei.

The Nokia layoff plan emerges less than one year after the company’s Alcatel-Lucent business laid off about 1,200 employees.

They revealed that the cuts will be in four major segments across their business. It is noteworthy, however, that it did not say in which country the employees were being laid off.

They explained that the decision was made as part of a drive to reduce costs for investing in research and development, including 5G, cloud and digital infrastructure, salary inflation, and other areas that will benefit it in the long-term.

The company, which has over one lakh employees, will limit the number to 80–85 thousand employees in around two years as part of the company restructuring. It hopes to save Rs 5,200 crore by 2023 through this effort in redundancies and other restructuring. According to the company, the cuts are related to a new business model introduced by Nokia in October.