United States telecom giant Verizon is shuttering several U.S. call centers, putting more than 3,000 people out of job
The closure is happening in New York, California, Connecticut, Nebraska, and Maine, dealing a heavy blow to the onshore contact center industry, which is prospering on the back of President Barack Obama’s favorite healthcare law.
While the number of jobs lost could have a significant impact on local communities, they only represent less than 2% of Verizon’s total workforce. The call centers handled calls related to sales and billing in addition to helping customers with technical problems.
Verizon says the closer is part of an effort to consolidate customer service operations, but analysts believe automation and shrinking telecom revenue could be the reason.
The move has angered labor unions. Communications Workers of America, has accused the carrier of outsourcing thousands of call center jobs to contractors in low-wage countries, including Mexico, Dominican Republic, and Philippines.
The telecom market in the United States is increasingly becoming saturated, with carriers finding their revenue declining with each passing month. Verizon, for example, saw its wireless revenue shrink by 3% in the first half of 2016.
The carrier appears to have automated some aspects of customer service in a bid to avoid customers the need to contact call centers. Many of its Fios products and services, for example, can be ordered online and installed without having to call a technician.
Moreover, Verizon appears to be trying to tap new revenue in areas such as digital media and advertising, because it has recently agreed to buy Yahoo for $4.8 billion.