More Jobs Lost Than Found During IBM Resource Action
March 14, 2016 Dan Burger
IBM‘s latest “Resource Action,” as it calls layoffs, has put the company in a position that is hard to defend. Big Blue has a ton of employees who were hired five, 10, 15, or 20 years ago to do work that no longer aligns with IBM’s strategic road map. Sorry folks, this company is not who you thought it was. And it’s no longer making money the way we thought it would. So things are changing.
Years of good job reviews and loyalty to the company get you a “Thanks for Coming” award. By executive decision, IBM is going in a different direction. And in a global economy, shifting the workforce to countries where wages are lower is the Smarter Planet way of doing things.
How do you make this sound like a good idea, unless it’s the stockholders you’re talking to?
Big Blue doesn’t really want to talk about it. For certain, it doesn’t want to talk about the collateral damages. And it’s less and less interested in mitigating that damage. Too costly for the company to bear.
IBM refuses to be open about the number of jobs it is cutting or which geographies (some people would call them communities) are most affected. That silence leads to speculation that workers in the United States will be the most likely to lose their jobs, an assertion that is not refuted by the company, which has trimmed its US workforce considerably in recent years, but makes no public accounting of the job liquidation.
A report released last week from the financial analyst firm Bernstein estimated 14,000 workers will be affected by IBM’s Q1 job cuts.
What IBM does choose to talk about is a claimed 25,000 job openings and a claimed 70,000 people hired in 2015. Details of where these current job opportunities are located are not revealed. And the 70,000 people hired are unaccounted for as well.
So instead of the story becoming IBM helps U.S. economy through job creation, it becomes IBM crushes the American Dream and sends more jobs overseas. And the hired are more accurately described as the acquired–riding along with new business acquisitions, which is not to be confused with job creation.
Those who have watched IBM’s human resources efforts for several years realize the company has a habit of making sizeable job reductions in the first quarter of the year. In the Bernstein report mentioned earlier, it was noted an annual savings of $1 billion in operating costs is IBM’s reward for what it refers to as “workforce rebalancing.” The biggest gains in operational savings are accomplished by completing cuts in Q1.
For Q1 2016, it’s the Global Technology Services and Global Business Services groups that are predicted to be shedding jobs, based on information gathered by Lee Conrad, formerly the head of Alliance@IBM, a unionizing effort for IBM’s employees in the United States that was never recognized by IBM and is now disbanded. Conrad continues to support worker and workplace issues for IBM employees and former employees by maintaining the www.watchingibm.com website and a social media site called Watching IBM. IBMers tell their termination stories and Conrad pieces together the data to determine which departments and locations are hardest hit.
Conrad, in a blog posted January 5 on watchingibm.com, estimated 71,000 people were employed by IBM in the United States on July 1, 2015. By comparison, in the mid-1980s, IBM’s U.S. employment totaled 230,000.
“Certainly companies cannot remain static. IBM has reinvented itself many times and continues to do so, but the changes at IBM for workers, retirees, and their communities have been devastating,” Conrad wrote.
Meanwhile, IBM’s worldwide employment figures have remained fairly constant, so what was lost in the US has been gained in other global locations. It doesn’t go unsaid that the “other global locations” are known for lower wages and reduced benefits.
In regard to the demise of the Alliance@IBM, Conrad wrote on the Alliance website that “Even though the Alliance web site received substantial visits and hits, that did not result in the membership growth inside IBM that was needed. Membership drives fell flat and many who said they would join waited too long and were swept away in a job cut.”