Fri, Jun 14, 2013 - Page 15 News List

IBM US job cuts reach at least 1,300, group says


International Business Machines Corp (IBM), the world’s largest computer-services provider, has fired at least 1,300 workers in a round of US job cuts that began on Wednesday as part of a global restructuring plan announced in April, according to employee group Alliance@IBM.

The reduction targets employees with a range of seniority, from rank-and-file staff to executives, said the person, who asked not to be named.

Some US workers began to receive notifications of the cuts last night, according to Lee Conrad, a coordinator for Alliance@IBM.

The restructuring will cost US$1 billion worldwide, including severance expenses.

IBM announced the job-cutting effort after releasing disappointing first-quarter results in April.

The New York-based company posted profit of US$3 a share in the period, missing the US$3.05 predicted by analysts — the first earnings shortfall since 2005, according to data compiled by Bloomberg.

IBM said at the time that the job reduction would be concentrated overseas and mostly complete by the end of this month.

The company is probably cutting 6,000 to 8,000 jobs globally, based on the US$1 billion cost figure, said Laurence Balter, an analyst at Oracle Investment Research in Fox Island, Washington.

That would represent less than 2 percent of IBM’s total workforce of 434,246 as of Dec. 31 last year.

Alliance@IBM said on its Web site that 121 employees were cut from a unit within IBM’s Systems and Technology group, the hardware division that saw revenue drop 17 percent last quarter.

“Change is constant in the technology industry and transformation is an essential feature of our business model,” IBM said on Wednesday in a statement, without giving specifics on the job cuts. “Consequently, some level of workforce remix is a constant requirement for our business. Given the competitive nature of our industry, we do not publicly discuss the details of staffing plans.”

The US$1 billion plan represents an increase over IBM’s job-cut efforts in recent years. The company spent US$803 million on workforce restructuring last year, up from US$440 million in 2011.

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