Tuesday, April 5, 2016
IBM Layoffs Hit Canada, Europe, Australia; US Likely Next
(Jessica Davis) It’s been just over one month since IBM began cutting jobs in the US in a layoff that one analyst firm calculates will ultimately hit at least 14,000 globally in fiscal 2016. Last week this wave of job cuts hit IBM’s Canada locations in Toronto and Ontario, following on cuts that happened in Europe and Australia in recent weeks.
About 900 staff members are expected to be cut in Germany.
Most cuts are expected to come earlier in the year rather than later, according the report from financial analyst firmBerstein, and many of those jobs will be moving to less expensive offshore labor markets, the firm said.
WatchingIBM, a Facebook page that tracks IBM’s job cuts, shared the news about these new rounds of cuts, which were reported to the page by affected employees, by unions, and by governments in countries that require corporations to report actual layoff numbers. Group founder and former IBM employee Lee Conrad spoke with InformationWeek about the news.
Conrad said that the hardest hit business units are Global Technology Services and Global Business Services, and Software.
“There’s a big shakeup going on inside of IBM, and they are changing their whole operating model,” he told InformationWeek. “Over the last couple years these job cuts have been relentless. It’s become such a dismal existence for employees.”
Conrad said that sources have told him that more job cuts are imminent in the US, and that an upcoming round of layoffs, or “resource actions,” is code-named Project Solitaire. He said employees have told him that job cuts are planned for every quarter of 2016.
IBM has declined to comment on number of jobs being cut this year, and initially provided the following statement to InformationWeek: “IBM is aggressively transforming its business to lead in a new era of cognitive and cloud computing. This includes remixing skills to meet client requirements.”
After InformationWeek linked to reports saying that a third of IBM’s workforce could be affected by this year’s job cuts, an IBM spokesperson contacted us to say that reports of such a high number were “completely outlandish and untrue.” IBM declined to provide an actual number of jobs targeted for cuts, but noted that the company hired 70,000 people in 2015 and currently has 25,000 open positions around the world, including ones in the US.
IBM ended fiscal 2015 with 377,757 employees, according to the company’s 10-K report filed with the US Securities and Exchange Commission, down from 379,592 in 2014. So those 70,000 new hires from 2015 replaced employees who were cut or left the company for other reasons, including voluntary departures. It’s unlikely that IBM will ever confirm job cut numbers beyond the markets where it is required by law to report those numbers.
Conrad has told InformationWeek that many of the jobs that IBM says are open are actually in offshore locations such as Brazil, China, and India. IBM has told InformationWeek that many of its job openings are in the US, but has not yet confirmed the number of US openings and the number of those US jobs actually filled in the first quarter of 2016.
Conrad is a former IBM employee who previously ran the now defunct Alliance@IBM group for unionizing IBM employees. The Facebook page has picked up the communications part of the mission of the former Alliance@IBM group.