Swedish telecoms giant Ericsson heaped yet more pain on the sector today by announcing 17,000 job cuts and warning of lower sales.

The Stockholm-based group will axe 7,000 workers over the rest of this year with a further 10,000 jobs set to go next year.

Ericsson, the world's largest manufacturer of equipment for mobile phone networks, has been sent reeling by the global slowdown.

Systems sales tumbled 25 per cent in the first quarter of the year as the group made a net loss of more than £248 million.

President and chief executive Kurt Hellstrom said the group should return to profit "at some point" in 2003.

But the mobile systems market is now expected to be down by more than 10 per cent this year, compared with previous estimates of zero to 10 per cent.

The group axed a fifth of its workforce over the course of 2001 and has already announced 3,000 more job cuts since January.

A spokeswoman for the group said it was too early to say whether today's plans would affect Ericsson's dwindling UK workforce.

The group now employs just over 1,000 UK staff with its main sites in Brighton, Burgess Hill and Guildford, Surrey.