Business

IBM workers brace for possible job cuts

Posted March 1, 2010

Layoffs coming at IBM?

— If U.S. employees at IBM (NYSE: IBM) are on edge, there is a very good reason: Rumors and reports are circulating widely within the company and on the Internet that a new round of layoffs is going to be announced Monday.

In IBM-speak, the term for layoffs is “resource action.” Affected workers described the process as being “RA’d.”

IBM employs some 10,000 people at its campus in RTP. It has long been the largest site for the global information technology and services giant. The company recently opened a new data center in RTP that will add some 30 jobs.

IBM wouldn't discuss the reports.

"As you know, we don't comment on speculation and rumor," IBM's Doug Shelton said when contacted by Local Tech Wire and WRAL.com.

Employees at a WebSphere development and support lab in Silicon Valley have reported a “big RA” is expected there with an “estimated 40-50%” of the staff to be “RA’d” on Monday, according to a post on the Alliance@IBM Web site. The Alliance is the union affiliate that is seeking to represent IBM workers.

Other posts at the Alliance site comments section (Read the comments section here) indicate that workers in the IBM Systems and Technology Group and the Integrated Technology Delivery groups could be affected.

The increasing number of posts and other information funneled to the Web site led the Alliance to issue an alert to selected media outlets on Saturday morning.

“The Alliance@IBM is getting reports of a job cut/resource action for Monday March 1st,” wrote Alliance National Coordinator Lee Conrad.

“We always expect cuts,” Conrad told Local Tech Wire and WRAL.com. “It is the date that is the guessing game.”

Other workers in Australia, New Zealand and the United Kingdom are already being affected.

The Register in the U.K. has confirmed that negotiations are under way with workers there for voluntary buyouts with employee decisions expected by March 8.

Meanwhile, at least 200 workers in Australia have been affected, according to the Alliance site.

However, the resource action in Australia could actually affect 800 employees, according to the information technology news publication iTnews.

The Australian Services Union told iTnews that IBM is considering offshoring jobs to lower-cost centers in India and China. One source said managers were told about the cuts last Wednesday.

iTnews quoted IBM spokesperson Matt Mollett as saying that IBM “continuously transforms its business, rebalancing skills and capabilities in order to meet the changing needs of clients and our business as a whole.” He also said IBM would "continue to hire in 2010, and ... end the year with more employees than when the year began.”

In his e-mail alert, Conrad noted the posting from Silicon Valley, which reads:

“Bay Area Lab (Foster City, CA) - Software (WebSphere Process Server development and support). Big RA on Monday 03/01. Estimated 40-50% will be RA'd in the lab.1on1s ready for Monday morning. It's really sad after a huge effort in the 4th quarter working late nights and weekends for nearly 3 months. Other labs in San Francisco Bay Area-Silicon Valley will be affected.”

“Other comments point to IBM ITD and STG divisions,” Conrad added.

“Number of cuts unknown until we get a resource action package from a terminated employee.

“Will know more Monday.”

If made, the layoffs would come just weeks after IBM announced a record profit of $13.4 billion in 2009.

IBM shares closed at $127.16 on Friday. Shares have traded as high as $134.25 in January.

“Last year IBMers remember the company also announced record profits and the very next day terminated about 5,000 employees around the country,” Conrad, a former IBM veteran who worked 26 years at Big Blue, told a New York newspaper recently.

“So when employees look at record profits, they don’t see any connection between record profits and them keeping their job. All they see is shareholders doing well and employees finding the unemployment line,” he added.

Citing IBM annual reports, Alliance@IBM notes that IBM has cut its U.S.-based workforce by nearly 30,000 over the past four years from 133,789 to 105,000.

120 Comments

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  • wildcat Mar 1, 6:54 p.m.

    With the floods, earth quakes, mud slides, etc. in these foreign countries, I guess America is getting hers with all this NO JOB ANYWHERE. This is the time when we need to lean on the Lord for help and pray.

  • wildcat Mar 1, 6:52 p.m.

    Praying for us all.

    Thanks. I have been out of work for over a year. No one wants to give anyone a chance. I have a good record too and lots of experience and is qualified. Keep praying for this is not longer America.

  • Spirit Warrior Woman - Rev. RB Mar 1, 6:42 p.m.

    bcrieske -

    Am praying for you good friend.

    My last husband worked for them for 25 years, and got laid off. IBM has turned into a not very pretty company.

    God bless.

    RB

  • Spirit Warrior Woman - Rev. RB Mar 1, 6:41 p.m.

    wildcat - "With no jobs in sight, what are people going to do?"

    That's a very good question.

    I've been laid off since 10/2008 (that's right 2008). I am very talented and very experienced, have a professional resume all laid out with skills and references listed, have sent out literally hundreds of resumes and filled out probably a hundred more applications online, AND CAN'T FIND A JOB.

    Have even tried part-time at McDonald's just to keep a roof over my head, to no avail.

    It's scary times.

    Praying for us all.

    God bless.

    RB

  • salesman Mar 1, 6:39 p.m.

    bcrieske,

    I was RA from IBM back in April 09. like youself in my mid- 50's. Ironically was just offered a job today! I was able to find odd jobs here and there to make the mortgage payments and pay my bills in the mean time. My advise is to keep everything positive and work harder for yourself.

    Good Luck to you.

  • wildcat Mar 1, 6:26 p.m.

    With no jobs in sight, what are people going to do?

  • wrx44 Mar 1, 5:53 p.m.

    What else is new....newsflash...IBM employees are not unionized. There is not any recourse to being fired. You here or you are gone, simple as that. And it is a sad day for many.

    But hey, as long as your stock went up, it's all good.

  • tran Mar 1, 5:33 p.m.

    "But then, MAYBE if people were willing to buy U.S. made products, we would have more U.S. manufacturers."

    Actually, big box retailer/distributors drove most of the outsouring and offshoring, not the consumer. Seldom were consumers presented with a choice of domestic or foreign made goods on the same shelf. Instead, the substitution was made and the only choice the consumer was presented with was buy foreign or do without.

  • Spirit Warrior Woman - Rev. RB Mar 1, 5:22 p.m.

    How can anyone feel comfortable working for a company that has a lousy layoff record like IBM or any other company really?

    It's like sitting on tenterhooks all the time.

    Praying for them.

    God bless.

    RB

  • whatelseisnew Mar 1, 5:19 p.m.

    How amazing the whining Americans are and they just do not get the fact that a U.S. employee is both expensive and dangerous. Why dangerous? try firing an employee that belongs to one of the protected specie groups. So how do you get rid of them, you use layoff programs. Even then corporate lawyers carefully examine the lists to make sure they have not hit too many of the protected species. In the meantime, our Government is not friendly to business if you make money and do not employ union thugs. Then consider the attitude of the average American worker. You can see it in many of the comments on here. They are owed, they are entitled and blah blah blah. On another note, being that I own stock I like this. Yep call me greedy all day long.

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