Nokia balances workforce in Finland with an eye on future business dynamics

January 31, 2006, Espoo, Finland - The communications sector is constantly undergoing change, driven by increased technological complexity, rapid subscriber growth in emerging markets, convergence, and the consequent need by network operators for greater levels of solution customization and local support.

Recognizing the opportunities these developments bring, and given Nokia’s longstanding commitment to constant organizational renewal, Nokia is taking proactive steps to hone its business activities and bring them closer to key markets and customers.

The Networks business group plans to strengthen activities in a number of key markets to improve its ability to support customers locally with tailored solutions that address future business needs. As a consequence, Networks’ R&D will increase somewhat in emerging markets, where infrastructure demand is anticipated to grow quickly, and the business group’s R&D investments are expected to decrease slightly in Finland.

“Finland is the key competence center for Networks’ R&D, and will play a pivotal role thanks to its unique, cumulative know-how and innovation strength,” says Juha Äkräs, Vice President, Global Operational Human Resources for Nokia, adding that other units in the company plan to add R&D staff in Finland over the coming year.

“Over the course of 2006, our expectation is that some 200 people in Networks will need to be redeployed due to workforce balancing. Based on Nokia’s overall recruitment activity, our track record of redeployment, and our estimates for this year, we are optimistic that new positions will be found for most of these people. During this process, we will be working closely with employees and their representatives to find the best solutions,” Äkräs said. In 2005, Nokia recruited approximately 1 500 new employees in Finland, with over 8 000 people rotating into new positions across the group.

“In some cases, employees may prefer to choose voluntary arrangements that we are planning to introduce. These are Nokia’s response to discussions held with employee representatives.”

The Enterprise Solutions Business Group plans to reduce resources in Finland to streamline and better harmonize its business with global demand. Approximately 90 people will be affected, with Nokia introducing voluntary severance packages and the possibility for redeployment within the company where possible.

Nokia’s organizational refocus will also impact some other units within the company including financial service function.

Nokia will start to discuss these planned changes and the redeployment possibilities with personnel representatives.

At end-2005, Nokia employed 58 874 people globally, of which 23 485 worked in Finland. There were 13 237 research and development personnel in Finland at the end of last year.

Nokia is a world leader in mobile communications, driving the growth and sustainability of the broader mobility industry. Nokia connects people to each other and the information that matters to them with easy-to-use and innovative products like mobile phones, devices and solutions for imaging, games, media and businesses. Nokia provides equipment, solutions and services for network operators and corporations.

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