BT chief's pay doubles as 7,731 staff cut and profits hit record

A sharp decline in workforce numbers at BT coincides with a spike in executive pay and record profit margins, creating a tense dynamic between shareholder rewards and employee job security. The company reported that its staff count has fallen to 90,000, a reduction of 7,731 positions since March. This headcount excludes workers in the international division, which is being spun off into a joint venture with Verizon. Two years ago, the total workforce stood at approximately 130,000.

Most of the layoffs occurred within Openreach, the division responsible for fiber network expansion. As the pace of new installations slows, the company is pursuing a plan to cut billions in costs by 2030. Despite the shrinking staff, BT posted a 12% increase in pre-tax profit, reaching £1.1 billion for the six months ending in September. Investors reacted favorably, with shares jumping 6% on Thursday to hit a five-year high on the London Stock Exchange.

CEO Allison Kirkby has led the cost-cutting drive since taking office in February 2024. She recently raised the group's savings target from £3 billion by 2029 to £3.7 billion by 2030. Management now expects headcount to stabilize between 75,000 and 80,000 by the end of the decade. This target is at the low end of the 75,000 to 90,000 range set in 2023, when the company noted that AI integration could eliminate 10,000 roles.

Kirkby's compensation more than doubled last year, reaching £5.6 million. This is the largest pay package for a BT leader in over a decade. Under her leadership, the company's stock value has risen by more than 70%. She also oversaw the £400 million acquisition of struggling rival TalkTalk, a deal described as a rescue operation for 2.5 million households and public sector clients.

On Thursday, Kirkby said she could not provide specifics on TalkTalk's future because the deal is still under regulatory review. The Salford-based firm employs about 900 people. Virgin Media O2, which also bid for TalkTalk, criticized the transaction as a stitch-up that would strengthen BT's market dominance. BT holds an estimated 30% of the UK broadband market according to Enders Analysis, and its Openreach network is the primary supplier for TalkTalk.

BT also reported record demand for its full-fiber network, which has reached 24.1 million homes. The company aims to install service in 25 million homes by year's end. This comes as Virgin Media O2 announced plans earlier this week to cut thousands of jobs in an £800 million savings drive.