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Thursday, February 27, 2014

IBM to Announce Job Layoffs, About One-Third the Size of Last Year's

Posted By on Thu, Feb 27, 2014 at 1:55 PM

click to enlarge ibm-1.jpg
It's déjà vu all over again.

On Thursday morning, Gov. Peter Shumlin confirmed rumors circulating for weeks: IBM is laying off an as-yet undisclosed number of workers at its Essex Junction plant, part of a global reduction in its workforce.

Although exact figures are unavailable, the Shumlin administration was told that this week's job cuts will be about one-third the size of Big Blue's July 2013 workforce reduction, when 419 Vermont employees were let go. That would mean 100-plus workers looking for new jobs. 

Shumlin issued the following statement Thursday morning:

"I have been advised by leadership at the IBM Vermont plant in Essex Junction of layoff notifications there as part of a global workforce reduction. This is difficult news for the affected workers and their families, as well as for the communities that also suffer the impacts of job reductions. I pledge to work with my team to help in every way we can. I understand the number of workers affected in this round of cuts is significantly lower than the last round of reductions, only about one-third the size, although we will not know the exact number of affected workers until the process is completed and a state notice is filed by the company next month. 

"While we never want to hear about employment losses, Vermont has diversified its economy in recent years, with recovery and job growth across many sectors. We also enjoy the 5th lowest unemployment rate in the country — the lowest rate east of the Mississippi. Companies in Vermont are looking for highly skilled, educated workers like those being affected by this reduction at IBM. We stand ready to offer all of our resources to help find good Vermont job opportunities as soon as possible for those who will face layoffs as quickly as possible."

IBM spokesperson Doug Shelton issued the following statement but provided no additional specifics on Vermont's IBM workforce:

"IBM continues to rebalance its workforce to meet the changing requirements of its clients, and to pioneer new, high value segments of the IT industry. To that end, IBM is positioning itself to lead in areas such as Cloud, Analytics and Cognitive Computing and investing in these priority areas. For example, already this year we have committed $1 billion to our new Watson unit and $1.2 billion to expand our Cloud footprint around the world. In addition, just this week IBM announced a $1 billion investment in platform-as-a-service Cloud capabilities, as well as investments in areas such as nanotechnology which will bring hundreds of new jobs to New York State. This also creates new job opportunities at IBM. At any given time, IBM has more than 3,000 job openings in these and other growth areas in the US. IBM's total workforce has remained stable over the past three years, and IBM now employs more than 400,000 people worldwide."

State law requires employers to notify the Vermont Department of Labor of any workforce reduction involving more than 25 workers. Vermont Labor Commissioner Annie Noonan said Thursday that IBM has told the state it will comply with that Vermont Employment Security Board rule, and she expects to have an exact job-cut figure in "about a month."

Noonan said the labor department will have its rapid response team involved with assisting dislocated workers, just as it did last summer. Noonan could not immediately provide figures on how many of the 419 workers laid off in June have since found new employment, but said the number of former IBMers filing unemployment claims has declined.

The state has also filed a federal trade petition on behalf of all 419 displaced IBM workers, which will make those employees eligible for additional retraining and educational benefits.

"With the steady increase in the economy," Noonan added, "we are quite hopeful that we can assist the laid-off workers find jobs with other Vermont companies."

Lieutenant Gov. Phil Scott issued the following statement about the IBM pink slips:

“This is terrible news for the affected employees, their families and communities. While I am relieved to learn the number of workers affected in this round of layoffs is about one-third of the 419 employees impacted in the last round, the fact of the matter is more than 100 Vermonters are losing their well-paying jobs. The trend of job losses over the last two years is concerning. This month, Plasan Carbon Composites in Bennington also announced triple-digit layoffs. In addition, the impending closure of Vermont Yankee means even more high-paying jobs will disappear from our state. I fear we in Montpelier are simply not doing enough to grow our economy, create high-paying jobs, or make it easier to do business within our borders. Today’s news is proof we cannot wait another second to turn our full focus to rectifying this economic situation we find ourselves in.”

A reporter was not allowed to enter IBM's Essex Junction facility to speak with workers there. All inquiries were referred to the corporate spokesman. 

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About The Author

Ken Picard

Ken Picard

Ken Picard has been a Seven Days staff writer since 2002. He has won numerous awards for his work, including the Vermont Press Association's 2005 Mavis Doyle award, a general excellence prize for reporters.


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