By silicon.com, 6 May 2005 11:50
NEWS A manufacturing union fears that UK workers at IBM will be the first to be axed as the IT giant gears up to cut up to 13,000 jobs, mostly in Europe.
Amicus, which has more than one million members, said that is cheaper and easier for IBM to make redundancies in the UK than anywhere else in Europe.
A spokesman for Amicus said: "We've called it a slash and burn reaction to poor first quarter results. We fear the worst as it's considerably easier to get rid of workers in the UK than in the rest of Europe."
IBM said on Wednesday that employee reductions will include both layoffs and voluntary departures. The majority of the cuts will be in Europe, where the company has initiated discussions with unions.
The reorganisation involves the streamlining of management in Europe. IBM said it will eliminate its pan-European management layer to reduce internal bureaucracy.
Ian Wesley, Ovum research director, believes that the bulk of the job losses will occur in France, Germany and Sweden, and pointed out that IBM's recent financial results for the UK were "fine". Media reports predicting IBM job losses have appeared in France, Germany and Sweden in recent weeks, which Wesley believes were sparked by discussions between IBM and local worker councils.
Wesley also warned that IBM's move could have wide implications, possibly impacting suppliers and other companies to which IBM has outsourced some services.
Dan Ilett and Graeme Wearden write for ZDNet UK
Comments
There is 1 comment. Join the discussion
1. Bill
As a former employee of "big blue" who took the last round of Volountary Separation package - this comes around every 4-6 years, by which time the workforce has crept back up to its previous number, if not higher. This happens in all companies with extremely large workforces (government and armed services too). the 1st to go are the middle management or longer serving employees with all the experience. it then gets noticed a little down the line that a lot of local, well rounded knowledge is gone. They then start to re-hire the same people who took, at least reasonable, packages.
Secondly, a large proportion of IBM's workforce are contractors of varying descriptions. These are often the first to go as the contract is simply not renewed or the contract is switched to another supplier. Again, many of these are long standing contractors, who after a short waiting period, simply apply to the new contractor and are back in a matter of months.
The shareholders see a jump in their bonus's over a short period, they are happy - so in a way, everyone wins in the end.
Maybe a very simplistic view, but hey, I can't be the only one who sees the roundabout (and just shakes his head in amazement)!