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Big-Blue Euro jobs cull coming?

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Big Blue's UK, German and Ireland employees should prepare for layoffs with thousands of jobs reportedly going to eastern Europe, the Far East and South America.

IBM has around 41,000 employees in UK and Germany, with contractors in the UK already having received pay cuts.

Lee Conrad, from US workers' group Alliance@IBM, is reported to have said though that he expects: "Many job cuts in Ireland, Germany and the UK in the coming months." Alliance@IBM claimed job cuts had already taken place in western Europe

IBM refused to comment on the reports.

Around 10,000 employees have been laid off by IBM in the US, many in its Global Services unit, since the start of the year. A lot of these jobs have gone outside the US to geographies that are more affordable according to Conrad. Some of the laid-off workers were angry that they were losing their jobs at a time IBM chief executive Sam Palmisano was paid a mind-boggling $19.5m.

Inside IBM US, a Project Match is said to enable employees who are being laid-off the opportunity to be transferred to a lower-wage geography - such as Brazil, China, the Czech Republic, India and Nigeria - where they would be paid a local rate.

Against this backdrop, IBM in the US is apparently attempting to pursue federal stimulus money from the US government - an action that would seem incompatible with sending US jobs offshore. The $787bn package, agreed by Congress in February, had a prime intention of preserving US jobs, something Big Blue seems not to understand.

Conrad reported said: "They're moving work offshore to pay lower wages and lower taxes. IBM shouldn't have their hands on stimulus money if they're offshoring work."

The business logic behind the cuts would seem to be to reduce IBM's own costs so that it could lower its services and other prices to customers hurting from the recession. ®

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