IBM
announced in January that it would lay off 3,900 employees and, reportedly, it is now preparing for more
job cuts
. However, it seems that this time the company is adopting a new method for thinning its staff. A report has said that IBM has asked its employees who want
voluntary redundancy
(want to leave the company) to come forward.
According to a report by The Register, IBM asked staff who want voluntary redundancy to raise their hand as it prepares to undertake a new round of global job cuts – majorly in Europe and within a handful of departments. Slovakia is said to be the most hit market.
IBM calls this the Resource Action and it was signalled last month in a Q4 earnings call. It aims to seek employees that are happy to take voluntary redundancy, rather than laying off others who don't want to leave.
There is no information on the total number of employees in scope for redundancies or the number of volunteers being sought.
Job cuts will be “transformative”
Citing insiders, the report said that this latest process is not considered to be financial but “transformative.” Notably, earlier this year, CFO James Kavanaugh said that the company is aiming to achieve “$3 billion annual run rate in savings by the end of 2024.”
What IBM has to say
A spokesperson from IBM told the publication that the upcoming job cuts are not a cost-saving initiative.
“In 4Q earnings last month, IBM disclosed a workforce rebalancing charge that would represent a very low single digit percentage of IBM’s global workforce, and we expect to exit 2024 at roughly the same level of employment as we entered with,” the spokesperson said.
“This rebalancing is driven by increases in productivity and our continued push to align our workforce with the skills most in demand among our clients, especially areas such as AI and hybrid cloud,” the spokesperson added.
Any financial savings will be used to free up money to invest in technical and industry skills, the company noted.
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