Nokia to cut 4,000 jobs as impact of new strategy bites

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Nokia today announced that it plans to cut its workforce by 4,000 employees by the end of 2012, as part of the restructuring resulting from its recent strategy changes. The majority of the cuts will take place in Finland, Denmark and the UK. They are part of the previously announced measures to cut Nokia's operational expenditure by €1 billion. In addition, a further 3,000 employees will move to Accenture as part of the transfer of Nokia's Symbian software activities, which was also announced today.

Finland will see around 1,400 job losses, representing around 12% of Nokia's current Finnish workforce of 12,000 people. Denmark and the UK will see between around 700 job losses each, with the rest spread out in other global locations. The job losses are expected to take place in phases and will be completed by the end of 2012. 

Nokia further announced that it plans to consolidate its research and development sites, with each site having a clear role and mission, and as a result some sites will expand and some will close. Offices in Copenhagen (Denmark), White Plains (New York, USA), Southwood (Farnborough, UK) and Southwark (London, UK) are expected to close. As part of the consolidation, a number of functions and staff in the aforementioned UK and USA offices will move to existing or new offices in the same geographies.


Other offices will change their focus: for example, in Finland, Tampere and Salo (previously Symbian and MeeGo) will focus on Windows Phone product development, Oulu will focus on basic phone product development (previously MeeGo) and Helsinki and Espoo will focus on head office activities, future technologies and basic product development.

The 4,000 total job losses represent around 25% of Nokia's research and development employees and are, inevitably, primarily focused on those developing the Symbian and MeeGo software platforms. It is a significant loss of talent for Nokia and underlines the dramatic nature of Nokia's recent smartphone strategy changes. The number of job losses is significantly lower than expected at (5-6% of Nokia's 65,000, rather than 12%) because of the transfer of Symbian activities to Accenture.

While the job losses take place over the next 18 months, Nokia will continue to under go its transformation. It will be increasing its capacity for the development of Windows Phone-based Nokia smartphones; similarly the company plans to increase its investment in 'Mobile Phone' (i.e. Series 40) and build a team to focus on future disruptions. However, with Microsoft providing the core smartphone software platform, it is clear than fewer staff will be needed for software platform research and development. 

The job losses announced today are the obvious human dimension of Nokia's decision to switch its smartphone software strategy from Symbian/MeeGo to Windows Phone. Nokia has put in place plans for a social responsibility program to help communities and employees affected by the job loses, but the magnitude of the cuts is still likely to have a traumatic impact, especially in Finland. 

The job losses respresent a very significant loss of talent for Nokia. 

Stephen Elop, Nokia president and CEO, said:

"At Nokia, we have new clarity around our path forward, which is focused on our leadership across smart devices, mobile phones and future disruptions. However, with this new focus, we also will face reductions in our workforce. This is a difficult reality, and we are working closely with our employees and partners to identify long-term re-employment programs for the talented people of Nokia."

"We are offering those who are losing their jobs a range of options, from individual re-employment support and re-training to making investments to promote innovation and working with a variety of partners to create new opportunities," Elop continued.