IBM said to be planning 10,000 job cuts ahead of strategic spinoff
IBM has already laid off some of its US workforce earlier this year as a result of the coronavirus pandemic. The company is said to be planning an even more dramatic round of job cuts in Europe to preserve the long-term health of its business.
Last month, IBM showed just how much it was struggling to stay relevant in the industry through the announcement of a strategic split into two separate companies. The first would be the legacy firm that will continue serving over 4,500 enterprise clients, and the second, called NewCo, will be tasked with innovating in the field of cloud IT-managed services and machine learning.
This week, a Bloomberg report revealed the company is also planning to cut around 10,000 jobs in Europe to reduce operating costs and simplify the spinoff process. This is a significant reduction of 20 percent of the staff working in the region, and will affect the UK and Germany the most, while cuts are also said to happen in Italy, Belgium, Poland, and Slovakia.
IBM so far refuses to acknowledge the report and only confirmed that broad structural changes are a possibility if they are beneficial for its long-term vision of delivering hybrid cloud services. A spokesperson told Bloomberg “our staffing decisions are made to provide the best support to our customers in adopting an open hybrid cloud platform and AI capabilities. We also continue to make significant investments in training and skills development for IBMers to best meet the needs of our customers.”
This unfortunately means that if you’re working in IBM’s day-to-day infrastructure operations for legacy IT contracts, you might not fit into the company’s new strategy which hinges on the recent $34 billion Red Hat acquisition.