IBM announced yesterday that it will be cutting an indeterminate number of jobs, in the face of an economic slowdown that is causing many businesses to cut back on planned IT investments. This major workforce reduction will be done under the new Chief Executive Officer of the company, Arvind Krishna.
The company stated last Thirsday:
IBM’s work in a highly competitive marketplace requires flexibility to constantly remix high-value skills, and our workforce decisions are made in the long-term interests of our business.
The US-based company has not disclosed the scale of the job cuts but employees but reductions are expected in IBM’s business across at least five states.
Last month IBM withdrew its financial forecast as software sales were affected negatively by the coronavirus pandemic. CFO James Kavanaugh talked about making structural changes in the company to improve the competitiveness of the company.
Earlier in May, CEO Arvind Krishna stated that IBM would cut even 5% of the dividend.
I believe that we actually have enough financial stability, including a secure dividend. The dividend is occupying a little bit more than half our free cash flow. It’s not like it’s occupying all of it, and that leaves enough flexibility for us to do it.
IBM’s job cuts are not the only sign of trouble in the tech industry due to the effects of the pandemic. Hewlett Packard Enterprise Co. announced an extensive cost-cutting program that includes cuts in salary, unpaid leave and a freeze in hiring.
Experienced writer and journalist, working in the global online trading sector, Steffy is the Editor of LeapRate. She has previous experience as a copywriter and has been with the company since January 2020. Steffy has a British and American Studies degree from St. Kliment Ochridski University in Sofia.