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Nokia to cut 3700 jobs in Finland

The mobile phonemaker plans to cut some 10,000 jobs worldwide by the end of next year, nearly one fifth of its workforce. In Finland more than one in three workers may leave.

Vartija Nokian Salon toimipisteen portilla. Image: Sami Tammi / Yle

Nokia plans to make 3700 workers in Finland redundant by the end of 2013.

Pertti Porokari, president of the Union of Professional Engineers in Finland (UIL) told Yle there will be cuts in marketing staff at least at all Nokia locations.

Nokia will close its facility in Salo, south-west Finland, except for its product development unit, with a loss of 850 jobs.

CEO Stephen Elop made a series of announcements at Nokia headquarters in Espoo on Thursday morning, which were relayed by video link to employees in other locations. He said he was "very sorry" for the current situation.

3 top execs to go

Nokia also announced a shakeup of its Leadership Team as of the end of this month. Three executive vice presidents are to go: chief marketing officer Jerri DeVard; Mary McDowell, EVP of Mobile Phones; and Niklas Savander, EVP of Markets. DeVard, a former senior vice president at US telecom operator Verizon, leaves after just a year and a half with Nokia.               

As expected, Nokia is also selling its Vertu luxury phone unit. The buyer is the Swedish private equity firm EQT. 

Nokia aims to chop expenditures by some 1.6 billion euros by the end of 2013.

The firm is under severe pressure to cut costs and improve its profitability. During the first quarter, its mobile handset sales sank by nearly a quarter compared with a year earlier despite overall growth in the mobile market.

Precise figures for how many people will be let go at various locations in Finland will become clear later on Thursday and on Friday, says chief shop steward for Nokia's white-collar workers in Espoo Harri Määttänen. He said that the cuts will affect all locations.

Määttänen said the extent of the reductions came as a shock to everyone. He pointed out that the redundancies affect 30-40 percent of all Nokia employees in Finland.