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AT&T won't say how many local jobs are among 12,000 to be cut

AT&T Inc. isn't saying yet how many local jobs may be lost as part of a plan announced today to cut about 12,000 jobs, or 4 percent of its workforce.

Layoffs at the Dallas-based telecommunications giant will be "across the company and across the country," spokesman Walt Sharp said, but he would not specify what departments and cities would be most affected.

The company has about 14,400 workers in North Texas and 300,000 companywide. These new round of layoffs come on top of 4,600 job cuts announced by the company in April.

AT&T becomes the latest big corporation to announce cutbacks as the nation's economy contracts. Sharp said the cuts are in response to economic factors and corporate streamlining, but customer service won't be impaired.

The job cuts will take place this month and throughout 2009. The company also plans to reduce capital spending next year.

"I still see the company as being strong," said Jeff Kagan, a telecommunication analyst in Atlanta. "It's just in a weak environment."

The new cuts come as AT&T, which provides local phone coverage in California, Texas and 20 other states, sees customers defect from landline phones to wireless services. In the last quarter, AT&T basic voice lines in service dropped 11 percent.

"Traditional telephone lines are shrinking," Kagan said. "I would have to guess the areas that are growing are not going to see cuts."

The company noted Thursday that it would still be hiring in 2009 in parts of the business that offer wireless, video and broadband Internet access. AT&T, which has seen its stock price decline about 30 percent this year, remains profitable, and has benefitted as the sole U.S. wireless carrier for Apple Inc.'s popular iPhone.

Kagan said that while customers may "throttle back" on some services, such as GPS, the moves are probably being made in anticipation of more bad economic news.

"The economy hasn't impacted these companies yet," Kagan said. "I see AT&T and Verizon as being very strong in a weak economy."

In a move that's nearly complete, AT&T announced earlier this year that it would relocate corporate headquarters from San Antonio to downtown Dallas. Kagan attributed some of the job cuts to the transformation.

"AT&T (originally Southwestern Bell) grew from the smallest Baby Bell 10 years ago to the biggest," Kagan said. "This is typically what companies do after mergers."

AT&T plans to take a charge of about $600 million in the fourth quarter for severance costs. The company noted that many of its non-management employees have guaranteed jobs because of union contracts. All affected workers will receive severance "in accordance with management policies or union agreements," the company said.

This report includes material from The Associated Press.