Vodafone’s Spanish unit has reached agreement with unions for the loss of 620 jobs, in an attempt to cope with market pressure resulting from the country’s recession.

The actual cuts are less than previously feared. Recent reports suggested the operator might cut its workforce by as much as 25 per cent, equivalent to 1,000 positions.

However, Vodafone has adopted other cost-saving measures which, including the outsourcing of certain services, which will affect up to 130 jobs, it said in a statement.

In addition, working conditions for 150 workers would be altered and 400 staff would no longer receive tax-free luncheon vouchers.

The country’s depressed economy means consumers are making cost savings. Vodafone, along with its rivals including Telefonica, have felt the effect in a number of ways.

Consumers have been moving to competitively-priced MVNOs with the result that Vodafone has been losing subscribers.

According to recent figures from the country’s telecoms regulator, it lost 1.6 million mobile connections during 2012. Rival Telefonica suffered even more, shedding more than three million connections.

The loss of consumers has fed through to declining revenue, as demonstrated in Vodafone’s most recent quarterly results.

In the three months to the end of December 2012, revenue at the operator’s Spanish unit fell by 11 per cent.