IBM Australia shy on job cut questions

IBM Australia will "redeploy" some local staff, but declined to comment on whether the local office would follow the US lead, after more than 700 staff were laid off in the United States.

"We are talking to some people about redeployment options to other parts of our business where there is continuing growth," a local IBM spokeswoman said, adding such changes are a "normal part of business operations".

"IBM is constantly reassessing its skills mix to meet the demands of the marketplace," she said.

When asked what the demands of the market are, she said the Australian marketplace is consistent with and reflects what has been reported to be happening in Asia, but could not provide information on how IBM sees the Asian marketplace.

She also declined to specify which parts of the business the redeployments would occur in, which departments the staff will be redeployed to or whether there would be job cuts down the track.

In a move believed to be the first in a worldwide cull, more than 700 employees at IBM plants around the United States got the axe yesterday. In Endicott New York, some 225, or 5 per cent of the approximately 4500 employees, will be affected by the layoffs.

IBM spokesman in Endicott Todd Martin said about half of those impacted would be offered other jobs in their current job categories within IBM, while about 112 will lose their jobs.

The most significant cutback will be in the server division software group, with minor cuts in accounting and global finance, he said.

Martin indicated the changes are not part of broader cutbacks that according to various reports published during the last few weeks could eliminate between 2 per cent and 3 per cent of IBM's jobs worldwide potentially totalling up to 8000 or 9000 jobs. For IBM, this would be the biggest round of layoffs since the early 1990s.

"This is a business unit looking at its business and determining what it needs to do to achieve efficiencies through the elimination of redundancies and consolidation of work," Martin said.

However, according to media reports from the US, an IBM spokeswoman confirmed IBM has begun taking layoff actions.

It has been reported that an IBM employee, speaking on condition of anonymity, confirmed the company slashed more than 200 jobs, mainly in its Storage Systems Group from its San Jose, Californian office.

According to reports about 150 workers, or 3 per cent of the 5000 employees of IBM's Rochester, Minnesota, plant also received layoff notices yesterday.

More IBM employees, speaking on condition of anonymity, have reportedly told the media that workers and managers in other IBM facilities have also been told their jobs are being eliminated.

Somers, New York, where most of IBM's operating divisions are headquartered, is said to be among the affected sites.

The cutbacks follow a disappointing first-quarter earnings result for the company due to a decline in sales.

Todd Weiss of Computerworld contributed to this report.

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