IBM begins cutting U.S. jobs in $1 billion restructuring

  • Article by: ALEX BARINKA , Bloomberg News
  • Updated: February 27, 2014 - 8:40 PM

Rochester operations said to be among those affected.

– IBM Corp. began dismissing U.S. workers Thursday, part of a $1 billion restructuring to help the company meet profit goals as it adapts to shifts in the technology industry.

Workers in New York, Vermont, Minnesota, Iowa, Missouri, Oklahoma and North Carolina were fired today, according to AllianceIBM, an employee group. The Armonk, N.Y.-based company had a head count of 431,212 at the end of 2013, down 0.7 percent from a year earlier — its first decline in a decade.

IBM is aiming for $20 a share in adjusted earnings by 2015, up from $11.67 in 2010 — a target made more difficult by seven straight quarters of falling revenue. To get there, Chief Executive Ginni Rometty has fired and furloughed workers, sold assets, cut IBM’s tax rate and bought back shares.

The company has already begun eliminating positions this year in Europe, Asia and South America, according to AllianceIBM.

Rometty is seeking to transform IBM as clients shift to storing their data and applications off-site, or in the cloud, rather than buying their own servers.

Firings took place Thursday in Endicott and Poughkeepsie, N.Y., AllianceIBM said.

IBM makes semiconductor chips at its plant in Burlington, Vt., and servers in Rochester, Minn., according to its website. The company has a delivery center in Dubuque, Iowa, that was to create as many as 1,300 jobs when it opened in 2009. The facility provides services including outsourcing-client support, server-systems operations, security services, and maintenance of hardware and software, according to the website. IBM dismissed workers in all three cities, in addition to Columbia, Mo.; Tulsa, Okla.; and the Raleigh, N.C., area, Alliance­IBM said.

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