Dramatic cuts in workforce as TPSA feels the pinch

Telekomunikacja Polska SA (TPSA), the dominant telecom operator in Poland, will cut 7200, or 10.6%, of its staff this year, as well as scale back its investment plans by zl.3.4 billion. TPSA initially planned investment outlays of zl.11 billion, but this figure has been revised to zl.7.6 billion. The unofficial cause of the modification is the economic slowdown in Poland. At the end of this year the telecom giant intends to have 60,900 employees, as compared with 68,100 at the end of 2000. Another 8% reduction is planned for next year. According to Wlodzimierz Giller, telecoms analyst with Erste Securities, TPSA's staff costs are as high as zl.4 billion annually, as compared with its current market value of zl.18 billion. Analysts view the employment restructuring process at TPSA as too sluggish, but Giller points out that according to last year's privatization agreement, no mass lay-offs will take place until the end of 2003. (Gazeta Wyborcza, Sept. 8-9, p.27, Reuters) T.J