IBM is latest tech giant to cut jobs in midst of pandemic | HT Tech

IBM is latest tech giant to cut jobs in midst of pandemic

IBM declined to comment on the total number, but the workforce reductions appear far-reaching.

By:BLOOMBERG
| Updated on: May 22 2020, 16:32 IST
Thousands of IBM workers in North America are likely to be affected
Thousands of IBM workers in North America are likely to be affected (REUTERS)

International Business Machines Corp. (IBM) cut an unspecified number of jobs across the U.S., eliminating employees in at least five states.

“IBM's work in a highly competitive marketplace requires flexibility to constantly add high-value skills to our workforce. While we always consider the current environment, IBM's workforce decisions are in the interest of the long-term health of our business,” company spokesman Ed Barbini said Thursday in a statement. “Recognizing the unique and difficult situation this business decision may create for some of our employees, IBM is offering subsidized medical coverage to all affected U.S. employees through June 2021.”

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Based on a review of IBM internal communications on the Slack corporate messaging service, the number of affected employees is likely to be in the thousands, said a North Carolina-based worker who lost his job along with his entire team of 12. “This was far ranging -- and historical employment ratings, age and seniority did not seem to matter,” he said. The person asked not to be identified on concern that speaking publicly may impact his severance package.

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The cuts also affected employees in Pennsylvania, California, Missouri and New York, where IBM is based, according to people familiar with the matter.

The tech industry has suffered widespread job losses after the coronavirus pandemic triggered a severe recession. Airbnb Inc. and Uber Technologies Inc. have cut about a quarter of their global workforces.

It's unclear how many of IBM's cuts are caused by the pandemic. The company has suffered years of falling revenue. In an earnings call in January, IBM discussed reducing costs through “aggressive structural actions” to improve the competitiveness of its Global Technology Services consulting unit, which represents about a third of revenue.

In online forums Thursday, dozens of newly unemployed IBM workers, some who said they had been with the company for more than 20 years, lamented the situation and expressed fear over finding a new job in a recession. “With the Covid situation, it will be hard to find new opportunities,” one wrote.

(By Olivia Carville)

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First Published Date: 22 May, 16:32 IST
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