There are plenty of new products on show at the Cebit trade show this week, but a demonstration of a different kind greeted visitors to the Hanover fairground Saturday morning. As bemused showgoers entered the north gate, a noisy group of IBM employees protested about job cuts at two of the company's customer support sites in Germany.
Around 270 workers in Hanover, and a further 330 at Schweinfurt in the southern half of Germany, will lose their jobs by the end of September when their offices are closed, one of the threatened employees explained.
Customers will likely experience a decline in the quality of service, said the IBM worker, who declined to be named.
Development and hardware support tasks carried out at the sites will likely be outsourced, with development going to local companies and support to either Hungary or China, he said. While some aspects of the job can be done remotely, "customers won't have anyone to talk to. If you have problems with hardware, it could take a lot of time to solve."
As for the staff, "It will be very difficult to find a new job, especially for older people aged 45 to 50," he said.
The state of the German IT job market cropped up during the Cebit opening ceremony on Wednesday night. Willi Berchtold, president of the German Association for Information Technology, Telecommunications and New Media (Bitkom), said the industry will create around 10,000 net new jobs this year. Bitkom predicts 12,000 jobs will be created in software and services, while 2,000 hardware manufacturing jobs will go.
Meanwhile, at the show, several of the workers praised IBM's previous efforts to retrain workers and reassign them to new areas.
However, IBM has recently ended its "Skillcenter" retraining program, the workers said, and while the company has around 90 vacancies in Germany, the workers said they had been told they would not be considered for these posts.
"Everybody is very shocked. The decision was taken very abruptly from our point of view. Nothing was done to plan how people should stay in work or get other jobs in the company," said one worker.
Another worker, there to support her colleagues although her job is not threatened, linked the planned job losses to contract IBM won in December 2002 to manage Deutsche Bank AG's IT services. Deutsche Bank transferred about 900 staff to IBM at that time.
"They have 600 too many," she said, but IBM can't lay off the former Deutsche Bank workers because of the terms of its contract with the bank, she said. Instead, to balance the books, the workers in Hanover and Schweinfurt are being told to leave -- even as IBM's Chairman and Chief Executive Officer Sam Palmisano gets paid US$8 million in total compensation, she said.
IBM spokesmen present at the show Saturday morning declined to comment for this article.