The storm hits AT&T, with a five-digit headcount reduction

This morning, the newly-demoted second-largest US phone carrier announced it's getting smaller still, shedding four percent of its workforce in another cost-saving operation for the economic recession.

The layoffs of some 12,000 employees will begin in December and continue throughout 2009, according to the company's statement this morning, however it was not specified which areas would be losing the most employees. AT&T noted that its wireless, video, and broadband sectors continue to add jobs, so wireline services will presumably be hit the hardest.

With landline services gradually fading into irrelevance, measures to scale back operations have been deliberate. This time last year, AT&T announced the total elimination of its payphone business, which involved the removal of some 65,000 public landlines during this year.

Around that time, AT&T laid out plans to reduce its workforce by 10,000 over the course of three years, and in April, it announced a further diminution by 4,600 jobs, mostly in the managerial sector.

The associated severance packages to terminated employees is expected to cost AT&T $600 million in the fourth quarter. Following that, the company plans to reduce its capital spending to pre-2008 levels.