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News > Technology
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IBM workers fear the axe
Employees union says layoffs expected to amount to as much as 10% of U.S. work force.
May 10, 2002: 2:01 PM EDT
By Richard Richtmyer, CNN/Money Staff Writer

NEW YORK (CNN/Money) - Workers at International Business Machines Corp. are bracing for layoffs that could affect thousands of workers, according to a representative of an IBM employees union.

"People are getting very nervous inside IBM," said Lee Conrad, national coordinator for the Alliance@IBM, an affiliate of the Communications Workers of America representing about 4,000 IBM employees.

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"There's a real sense of foreboding," Conrad said. Conrad said some IBM divisions, including its server and microelectronics divisions, already have begun quietly telling some employees to expect layoffs starting as early as next week.

"We expect announcements to start coming next week and continuing for the next three weeks after that," Conrad said. "We're hearing anything up to about 10 percent across the board."

Roughly 160,000 of IBM's global work force is based in the United States.

A source familiar with the IBM situation said Friday the cuts could amount to about 8,000 jobs.

A spokeswoman for IBM, the world's largest computer maker, declined to comment for the second day running Friday.

IBM historically has been known for making "stealth layoffs," referring to small job cuts across a range of departments, which keeps it out of the public eye.

Given the magnitude of the job cuts expected in the next round, Conrad said it will be difficult to keep them quiet.

"This time I think you'll see a lot more public notice," he said. "These appear to be much larger cuts."

In an internal address to IBM employees last month, Samuel Palmisano, the company's newly-minted CEO, said that business was weak and a recovery was not around the corner.

He also said the company would need to "pare back" costs to adapt to the difficult business conditions.

Shares of IBM (IBM: Research, Estimates), a component of the Dow Jones industrial average, were down modestly in afternoon trade Friday after sliding 3 percent Thursday.  Top of page






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