Wireless jobs disappear despite booming revenues

Phil Goldstein

Jobs in the wireless industry have been fading away even as the industry's revenues have boomed during the past few years, according to the latest figures from the U.S. Department of Labor.

According to an analysis of the statistics by the Wall Street Journal, in May the employment at U.S. wireless carriers hit a 12-year low of 166,600, or 20,000 fewer jobs than when the economic recession officially ended in June 2009 and 2,000 less than a year ago. However, since 2006 the industry's overall revenue has jumped 28 percent.

What accounts for the gap between growing revenue and weaker job numbers? For one, wireless carriers have been simply making do with fewer workers; in 2009, which is the latest data available, productivity of wireless-carrier workers jumped 24.3 percent, and since 2002, output per hour in the industry has nearly tripled.

Additionally, carriers also have cut back on the number of call center workers they employ. This trend is most evident at Sprint Nextel (NYSE:S), which has pared back its workforce in recent years. The company introduced simpler rate plans, which generally means fewer calls to customer care. Additionally, as customer service improves, there a fewer calls and less of a need to employ customer service representatives. 

The CTIA said the Labor Department's data is interesting but incomplete. In a blog post last week rebutting the data, Bob Roche, vice president of research for CTIA, said the data do not take into account the wireless ecosystem value chain.

"There are a whole host of companies that make up the wireless (and wireline) ecosystem: license holders; virtual network operators (resellers); tower construction and maintenance companies; network management companies; handset, accessory, chip and component, network equipment manufacturers and suppliers; antenna companies; software and application developers; content providers; application store operators; aggregators; the list goes on," he wrote.

"Sometimes jobs simply shift within companies, from one division to another (e.g. from wireline to wireless). Sometimes jobs, and the employees who fill them, shift between companies--from a carrier to a network manager or from a carrier to a tower company. This has happened in the wireless industry more than once over the past decade."