IBM Begins Global Job Reductions

In April IBM announced a $1bn global restructuring plan aimed at streamlining the business.  This week, the first steps along that plan were taken with the announcement of job cuts in their American operation.

The job losses are to be implemented across the IBM hierachy, with the changes set to cost the business $1bn in total.

The restructuring was initially announced after disappointing results back in April.  The company announced profits of $3 per share for the first quarter against expectations of $3.05.  This was the first time that targets had been missed since 2005.

It's believed that most of the 6-8,000 jobs that will be shed will be done at IBM's overseas offices, and the plan is for the restructuring to be complete by the end of June.

“Change is constant in the technology industry and transformation is an essential feature of our business model,” IBM said today in a statement, without giving specifics on the job cuts.“Consequently, some level of workforce remix is a constant requirement for our business. Given the competitive nature of our industry, we do not publicly discuss the details of staffing plans.”

Shares in IBM dropped 1.4% on reaction to the news, but it must be set in the context of an overall rise of 5% this year.