IBM quietly lays off North American staff

Update January 25 at 11:38 a.m. PST with comment from IBM.

IBM has been quietly laying off workers in its North American offices since Wednesday, according to numerous reports online.

IBM has not made any formal announcements yet, but IBM Director of Corporate Media Relations Doug Shelton confirmed to CNET News on Saturday that some employees were notified on January 21 that their jobs were being cut. The company would not say how many people had been laid off or in what facilities or departments those cuts were made.

Speculation about those details are rampant online. So far, more than 2,800 employees have been laid off from IBM's software, and sales and distribution divisions, according to Alliance@IBM, a Communications Workers of America affiliate attempting to organize IBM workers into a union. Comments on the Alliance@IBM Web site indicate that cuts have already been made in Toronto. And a spokesman for IBM Canada confirmed on Friday that IBM is in the process of laying off employees, some of whom were in the Canadian offices, according to ComputerWorld Canada.

Whether layoffs will make their way to the U.S. facilities (or whether they already have) hasn't been announced. A representative from Alliance@IBM told the Poughkeepsie Journal that it expects IBM will cut jobs at its facilities in Poughkeepsie and East Fishkill, N.Y., and Burlington, Vt., this week. Shelton would not comment on plans for more cuts.

The layoffs come despite the fact that IBM gave Wall Street something to smile about, with a strong earnings report earlier this week. The company said Tuesday that it beat analysts' expectations with a 12 percent increase in fourth-quarter earnings, and gave a positive outlook for 2009.

IBM's Shelton did not pin the layoffs on the economy as many other companies have. Rather, he said, "The nature of our business is such that we must constantly assess employee skills and resources and at any given time, to give IBM the flexibility to match the current and future needs of our clients. Managing resources in this way keeps us competitive, while adapting to the evolving needs of our clients." Shelton also said the company would try to help employees find other position within IBM where possible.

CNET News' sister site ZDNet Asia reported earlier this month that IBM is planning to cut 2,600 jobs across its Asia-Pacific operations.

IBM has nearly 387,000 employees worldwide, according to its Web site.

[bakedpatato]

Well, its not quiet anymore since its on the interwebs...

[dragonbite]

IBM just posted rosy financial news with a 12% increase in 4th quarter earnings and a good outlook for 2009 and now they are rumored to be laying off 2,800 people in North America and 2,600 in Asia-Pacific?

They have a funny idea of upbeat news!

[bakedpatato]

They're just trying to buckle down.You never know...z9 servers don't sell well in when the economy is in the toilet.

[dargon19888]

Its more than just 2800 people in North America.

No one knows because during the RIF action, you're given a pink slip and 30 days. Its only after the 30 days that you'll know where you stand.

IBM does this 'culling of the herd' every year or so. Only they ramp it up when you have a down turn in the market.

[twilsone]

This many Layoffs while posting these results? We are simply doomed!

[gerrrg]

That's less than 2% worldwide. That's not even getting rid of the fat, IYKWIM.

[PacificGatePost]

As corporate layoffs accelerate, could we look at other cutbacks to reduce the carnage and unemployment lines?

http://pacificgatepost.blogspot.com/2009/01/youre-fired-now-wheres-my-raise.html

?. Another attitude adjustment for corporate America?s senior executives.

[Mr. Dee]

Nearly 400,000 employees? That Company needs to go on a diet. I hope this is a clear understanding that everybody in the industry is affected, not just Microsoft as some are making it out to be. Every company has been touched by this recession, Bauxite/Alumina Company's in Jamaica are also preparing to let go hundreds of workers. So, everyone is feeling the pinch.

[MSSlayer]

Nobody is saying only MS is impacted.

Nice strawman deedeedee.

[ivaskaj]

It is no longer cost effective to do business in America. Our oppressive taxation system is forcing all of our industry over-seas to countries that don't steal as much of the profits. www.fairtax.org . If you disagree with any of the above, you are wrong. Period.

[SeizeCTRL]

Has nothing to do with taxes and everything to do with fat cat CEO's wanting to cut every cost corner they can so they can keep getting those hefty bonuses. Any CEO that has to do lay-offs should not receive a bonus of any kind.

[Lerianis]

SeizeCTRL, I couldn't have put it better msyelf. The fact is that if we would limit CEO/board member/CFO/etc. compensation to no more than 1 million a year without the input of stockholders by law, then these companies would be MUCH better off than they are right now.

[dargon19888]

Huh?

I don't know what you've been smoking but put down the pipe and step away.

IBM does business in North America. They are continually doing large outsourcing deals where major companies are shifting their operations to IBM and then IBM will offshore the bulk of the work when and where they can.

IBM is also reducing their higher costing US employees and will onshore labor when they can.

IBM is all about the margins.

[SactoGuy018]

AMEN!

If President Obama wants an economic turnaround that could even fuel his "green" economic agenda, how about doing something about that completely unwieldy Federal income tax system, with 67,000-plus pages of regulations so complex even the IRS can't figure it out! (eek!)

Just even the act of lowering the maximum marginal tax rate to 20% and reducing deductions and credits to a bare minimum would give a gigantic boost to the US economy just from a dramatic reduction in tax compliance costs alone.

[ShadowL]

Well who will buy all the products these companies are selling if no one in America has a job or at least one that pays more then minimum wage

[dennisl59]

The Canadian IBM Jobsite doesn't go anywhere, I just tried.

But this is from the IBM job website for the US, 1/25.

As usual, there is a "disconnect" going on here.

Click one of the links below to browse jobs within a category of interest.
Administrative Services (80)
Communications (5)
Consultant (597)
Finance (164)
General Executive Management (22)
Hardware Development & Support (23)
Human Resources (113)
IT Architect (184)
IT Specialist (685)
Legal (1)
Manufacturing (6)
Marketing (35)
Other (202)
Product Services (28)
Project Executive (9)
Project Management (165)
Research (14)
Sales (518)
Services Solutions Management (19)
Software Development & Support (198)
Supply Chain (77)
Technical Services (115)

[RompStar_420]

OBAMA is in office for only a few Days, almost a week. I have faith in him, because everyone else is a clown that would have done no better.

But if in 4 years, **** is still rotating on a fan, I will not vote for him otherwise he gets another vote from me and does 2 terms.

[RompStar_420]

At a large company where there are 400k people, you are nothing but a number, almost impossible to stick your head out of a hole to be recognized, so I would be always ready for the worse.

[inachu]

lets fire people and give top positions a raise!
Sounds like the old boy network at work yet again.
.......Hmm i fI can release these people and take the money for myself then I can get that sports car for my wife! HAHAHA

[jollyruss]

The ever-increasing costs of medical insurance is what's costing companies big-bucks and forcing them to offshore jobs to counties with nationalized healthcare. In addition, the dumbing-down of america has created a skills deficit causing companies to seek highly educated overseas workers. Corporate greed definitely got us into this mess. Giving companies taxpayer funded bailouts isn't the cure -- nationalized healthcare is. The more companies lay-off people, the less money (from income taxes) there will be to bail them out in the future!

[Lerianis]

Well, Obama is not going to be able to fix all these problems by himself. You should ALSO look at how much cooperation he gets from Congress on the things that he wants to do.... if he doesn't get much, if any, then cut the guy some slack.... he can't do it ALL on his own.

[vurbano]

Raise your hand if you buy IBM products.

[MSSlayer]

IBM lives mainly in the enterprise space.

[es48]

IBM, like many of our other great companies is the victim of corporate raiders. Go after the ones responsible.

http://ewebsmith.com/bus/investordestruction.html

[dargon19888]

"IBM's Shelton did not pin the layoffs on the economy as many other companies have. Rather, he said, "The nature of our business is such that we must constantly assess employee skills and resources and at any given time, to give IBM the flexibility to match the current and future needs of our clients. Managing resources in this way keeps us competitive, while adapting to the evolving needs of our clients." Shelton also said the company would try to help employees find other position within IBM where possible.
-=-
Of course they didn't pin it on the economy. How can they when they beat their numbers and had a record year in terms of revenue.

IBM is laying off workers where they can and are then hiring workers in cheaper countries to pick up the work .

With respect to S&D, IBM is reducing the sales teams and are shifting the work to IBM.COM which are manned with call centers in India. The idea is that they can still capture a lot of their revenues with call center workers who are much cheaper than a large technical sales force.

[TV James]

Nice headline... "IBM quietly lays off North American staff"

I immediately thought "All of them?" Knew it wasn't true, but had a quick chuckle anyhow.

[gzrider]

Seems they for got to mention that in the Service groups they are also cutting pay of the contractors and employees. So all the bonuses on the managers are getting are of the cuts on the lower people. Again IBM shows no desire to help the employees, but takes care of its managers.

[woelfchen.paul]

In most cases, in Canad aat least, the layoffs are touted as being about performance when there are NO such issues. Classic corporate misdirection and double-speak, but no company will be honest enough to admit what they are really doing.

IBM is most definitely, as already noted, laying off highly paid workers, some with over 10 years of history at IBM, and replacing it with cheaper labour.

[BMG4ME]

Alliance@IBM is not a representative of IBM, and I wouldn't believe any figures that an organization which has been trying unsuccessfully to get into IBM for decades posts about layoffs, and by the way they don't represent IBM.