New Analysis: AT&T Cutting Jobs, Abandoning Rural Communities Across Midwest

Despite promises to create jobs and invest in rural communities, AT&T is cutting jobs and neglecting rural network improvements in Wisconsin, Ohio, Michigan, Illinois and Indiana
Wednesday, June 12, 2019

WASHINGTON - Four new reports from the Communications Workers of America (CWA) show that AT&T is neglecting rural and suburban communities across the Midwest. Focusing on Wisconsin, Ohio, Michigan and Indiana, the reports detail how AT&T is cutting its workforce and creating service problems for customers and public safety hazards. Despite promises to create jobs and serve rural customers, AT&T has eliminated jobs in these states and failed to invest adequately in the next-generation networks that American families and businesses need to access today’s data-intensive online services.

In many rural communities, AT&T voice service is a lifeline for customers, yet in the states examined by CWA, AT&T has not upgraded its copper network to fiber to better serve customers in large swaths of the states. Across the midwest, AT&T copper cable—for many the only source of landline phone and Internet—is significantly damaged. Despite the clear need for an updated telecommunications network, AT&T continues to cut jobs and close call centers, devastating families and upending lives.

AT&T lobbied for the Tax Cut and Jobs Act and said it would use its resulting increased profits to create more good middle-class jobs and raise wages, but the company has eliminated over 23,000 jobs since the bill passed. These job cuts come even as the company received a $21 billion windfall from the tax bill and is projecting $3 billion in annual tax savings going forward. AT&T’s SEC filings also shows the company boosted executive pay and suggests that after refunds, it paid no cash income taxes in 2018 and slashed capital investments by $1.4 billion.

"The strongest claim made by proponents of the 2017 Tax Cuts and Jobs Act was that it would trickle down to aid working families by boosting wages and creating jobs,” said Josh Bivens, Director of Research for the Economic Policy Institute. “This was never a convincing claim and we can see now just how cynical it was all along: after lobbying fiercely for a corporate tax cut that put literally billions in their coffers, AT&T is fighting tooth and nail to make sure that they don't have to share any of this new profitability with their workers by committing to invest in good jobs."

“AT&T has turned its back on rural and suburban communities in the Midwest by eliminating jobs, advocating for deregulation and cutting investments in these areas,” said Linda L. Hinton, Vice President of CWA District 4. “In states like Illinois, Indiana, Ohio, Michigan and Wisconsin, AT&T is failing the many communities that rely on the company’s services as a lifeline. We will not stand idly by while AT&T receives billions in tax benefits but turns a blind eye to our nation’s crumbling infrastructure. It’s time for AT&T to provide answers about where all that extra income is going.”

Quality service depends on adequate staffing by trained, career employees. Yet the reports note that AT&T has made the following cuts to its workforce over the past two years:

Wisconsin

  • Reduced its outside plant technicians by 26 percent, dropping from 909 to just 673;
  • Reduced its total wireline workforce – outside technicians, inside technicians, call center workers, and administrative staff – by 23 percent, from 1,677 to 1,288 workers;
  • Reduced its call center workforce by 21 percent in the last two years.

Ohio

  • Reduced outside plant technicians by 20 percent, dropping from 2,093 to just 1,672;
  • Reduced its total wireline workforce by 21 percent, from 3,019 to 2,375 workers;
  • Reduced its call center workforce by 50 percent in the last two years.

Michigan

  • Reduced its outside plant technicians by 26 percent, dropping from 2,304 to just 1,704;
  • Reduced its total wireline workforce by 26 percent, from 4,157 to 3,067 workers;
  • Reduced its call center workforce by 46 percent in the last two years.

Indiana

  • Reduced its outside plant technicians by 19 percent, dropping from 1,078 to just 876;
  • Reduced its total wireline workforce by 20 percent, from 1,632 to 1,302 workers;
  • Reduced its call center workforce by 61 percent in the last two years.

CWA supports continued investment in next-generation fiber and wireless networks. Meanwhile, AT&T has a statutory obligation to provide an adequate amount of service in each of the four states highlighted by the reports, yet through systemic disrepair of its traditional landline network, many customers may no longer rely upon AT&T to provide reliable telecommunications service.

“I’ve seen first-hand how AT&T is abandoning communities like mine,” said Bradley D. Crain, Mayor of Covington, Indiana. “Our town is trying to grow and thrive, but AT&T is making it hard for us. How are our kids supposed to do their homework if they can’t access the Internet? How are families supposed to stay in touch if they don’t have basic phone services? Our community might not have the kind of wealth or influence big cities have, but this is the 21st century and AT&T should not be allowed to cut us off from the world.”

In Ohio, customers have filed numerous complaints with the Public Utilities Commission of Ohio (PUCO) regarding various service issues. Records obtained by CWA show that since 2016, PUCO received more than 6,000 informal complaints from AT&T customers relating to such issues. CWA is also filing a complaint with PUCO - based on evidence in the new Ohio report - calling for an investigation into the adequacy and reliability of service provided by AT&T.

All four states highlighted by the reports have seen public oversight of the telecommunications industry reduced in recent years. Deregulation proponents argued that competition could replace regulatory protections that held AT&T accountable. But as the evidence in the reports indicates, eliminating public oversight and relying solely on competition has failed to ensure that AT&T meets its statutory obligation to provide adequate service in these states.

Because of the lack of public oversight, CWA is encouraging AT&T customers in the Midwest to share information about internet and phone service issues on a new website, ATTBrokenPromises.org/ServiceQuality, so that elected leaders can better understand the problems that their constituents are facing and hold the AT&T accountable for its deteriorating network.

Elected officials in the four states have expressed concerns about AT&T’s actions and confidence in CWA’s findings; including, Brian K. Elder (Michigan State Representative and Chair of the Michigan Legislative Labor Caucus), Michele Lepore-Hagan (Ohio State Representative), Marina Dimitrijevic (Milwaukee County Supervisor), and Bradley D. Crain (Mayor of Covington, IN). Please reach out to the press contacts listed above—Sam Schneider and Dean Pearce—if you are interested in receiving statements from these individuals.

Read each of the new reports here: Wisconsin, Ohio, Michigan, Indiana

BACKGROUND

CWA has been leading the charge to hold AT&T accountable to the jobs promises the company made as part of its effort to pass the Tax Cut and Jobs Act. In March, CWA President Chris Shelton testified in front of the House Ways and Means Committee about the impact of the Tax Cut and Jobs Act on American workers, and called on Congress to probe AT&T on how it is spending its tax cut money, saying: “You may ask ‘what is AT&T doing with this money if it’s not being used to create jobs and invest in the U.S.?’ We’d like to know as well.”

CWA’s contracts with AT&T’s Midwest and national Legacy T units expired over a year ago, the contract at AT&T Mobility in Puerto Rico has also expired, and negotiations will begin soon at AT&T Southeast, where the contract expires in August. AT&T has a history of constructive labor relations, but its insistence on eliminating long-term employees to reduce costs has undermined the trust of its workforce.

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