IBM’s next round of layoffs are expected to begin later today, according to a union for IBM employees.
The internal code name for this round of cuts is “Project Apollo,” sources told the union, [email protected] on an online forum where those who work for IBM can post comments about what’s going on inside the company.
No one knows exactly how many people IBM will cut as part of its 2014 “workforce rebalancing.” IBM won’t comment on the number of employees affected but CFO Martin Schroeter did say that IBM plans to spend $US1 billion on 2014’s cuts, “plus or minus $US100 million,” (the same as it spent in 2013) and that the layoff would occur in the first quarter.
Wall Street analyst Toni Sacconaghi, from Bernstein Research, said in a note to investors that he estimates IBM will cut “at least 13,000 heads” worldwide, as reported by Barron’s Tiernan Ray.
Sacconaghi figures it costs IBM about $US70,000 to let an employee go, reports The Poughkeepsie Journal’s Dan D’Ambrosio.
Earlier this month, IBM reportedly let over 1,200 workers go in Europe And India. [email protected], which keeps an informal tally of U.S. employee headcounts, believes that IBM reduced its U.S. workforce by over 2,800 workers in 2013.
Not all of the cuts will necessarily be layoffs, either. IBM recently sold one of its computer server businesses to Lenovo and about 7,500 jobs will shift from IBM’s payroll to Lenovo’s when that deal closes. IBM has said it’s looking to sell other business units, too.
With more cuts looming, the governor of New York this week announced an agreement with IBM in which the tech giant promised to maintain at least 3,100 employees in New York through the end of 2016, including bringing 500 new jobs to Buffalo.
That still leaves IBM plenty of wiggle room for cuts in the state. IBM, which is headquartered in Armonk, N.Y., is a major employer there. The Poughkeepsie Journal says IBM employs 7,500 in Dutchess County alone. Sources say the mood at various IBM locations from New York to Boulder, Colo., is tense.
The latest total headcount number for IBM is from 2012: 434,246.
IBM had no comment on the date when U.S. layoffs will begin.
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