IBM said that it will be cutting between 10,000 and 13,000 jobs as part of its new restructuring plan.
The jobs that are cut will add up to about 4% of the company’s entire workforce. Most job cuts will take place in Germany, the UK, Italy, and France.
“Harsh job cuts in Europe will offset the 19,000 jobs created by the technology company last year,” said David Utter of Murdok. “Interests in the European Union will not be pleased with the massive layoffs announced by Big Blue.”
Big factors leading to the company’s restructuring include inefficiencies in client contact and massive layers of bureaucracy.
IBM plans for this restructuring plan to save it $300 million to $500 million dollars in the second half of this year and as much as a billion dollars next year.
“We are taking action on two fronts,” said IBM CFO, Mark Loughridge. “These actions will strengthen our business, improve productivity and responsiveness and facilitate growth.”
The company said that it has already started discussions for voluntary and involuntary reductions to its workforce.
IBM says that many of the European job cuts will be voluntary, but most that take place in the U.S. will not be.
IBM has to finish negotiating with labor unions before it will disclose any details about what positions will be involved in the restructuring.
The company expects to meet its goals for 2005 based on cost cutting.
IBM currently employs more than 329,000 people around the world.
Chris is a staff writer for Murdok. Visit Murdok for the latest ebusiness news.
