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Australia’s largest operator Telstra has stunned its workforce after publicly announcing it plans to reduce its workforce by cutting 1,400 jobs over the next six months. Trade Unions in Australia have described the decision by the telecommunications operator as an ‘ambush’ on workers. Telstra CEO, Andy Penn has said that the organization needs to streamline its operations after becoming under increased competition which has affected its earnings significantly.

Telstra declared that it needed to be ‘leaner’ pointing to the country’s expansion of the NBN (National Broadband Network) and the entry of aggressive new players offering consumers additional services as the primary reasons for its decision to reduce its workforce.

It has been projected by industry analysts that Telstra earnings will be reduced by between 2AUD-AUD3 billion by 2020 – due to lost compensation payments and the access fees it will be forced to pay in order to use the NBN. The operator is Australia’s largest telco with a 51% share of the country’s mobile connections. However, it has also recently disclosed its intentions to invest AUD3 billion to overhaul and upgrade its network over the next three years.

Telstra’s decision has been heavily criticized in some quarters, but in a statement the operator’s CEO said it can no longer afford to operate in the way it has done previously, and was adamant the cuts were necessary. It’s believed that 90% of the jobs will be lost in New South Wales and Victoria. In addition to this, it has been revealed that 172 employees will be let go in South Australia, Western Australia and Queensland combined.

The cuts will have a significant impact on Telstra’s day-to-day operations, a representative of the organization added that it will also impact its retail, operations, government enterprises and services and to a smaller extent, its media and marketing departments. The Communication Workers Union said it would meet with Telstra later this week.