Keeping in lines with the trend where companies find work force slashing as the most obvious mode of achieving cost savings, Ericsson announced that it will close one of its plant in Gavle, Sweden employing about 856 professionals. Another 90 staff will be axed from the Boras unit. When combined the slashing amount to 5% of the company’s domestic head count.

“We have to reduce the number of employees in production because the amount of labour required for our products is less and at the same time we are becoming more efficient," said the company.

The new job slashing is in addition to the earlier announced plans of slashing about 5,000 jobs to achieve $ 1.41 billion in cost savings.

In November the company had announced 700 job cuts in UK.

In Q3 09, the company saw its net decline by 71% though it was mainly on account of expenses incurred as part of the cost cutting programme. Revenues too were down by 6%.

The growing competition from Chinese vendors has forced traditional vendors such as Ericsson, NSN and Alcatel-Lucent to focus on costs inorder to be able to compete with the Chinese players. And while doing so the companies have resorted to job cuts as an immediate measure.