PCCW has blamed tough market conditions for the sacking of 83 staff at its Unihub unit yesterday.
'Faced with a fiercely competitive market situation in the information technology and telecommunications field, Unihub has had to rationalise its staffing levels in order to enhance its competitive edge and maximise its potential for existing and future customers,' PCCW said.
Sources said while there were signs of recovery in the local economy, these had not yet translated into sufficient contracts for the unit.
Unihub, formed in September, is the company's one-stop IT services brand. It does business in Hong Kong and on the mainland. All the layoffs were in Hong Kong. The unit employs more than 2,000 people.
It is believed most of those who lost their jobs yesterday had been working on projects relating to the development of Hong Kong's smart identification card.
Leung Ting-to, chairman of the PCCW employee association, feared the layoffs might be the start of a trend towards project-specific hiring. He was concerned the firm might be looking to take advantage of lower wages on the mainland by hiring more people there.