IBM Denies Plan To Cut 75% Of Workforce

Big Blue dismisses report that it intends to replace three-quarters of its global staff with independent contractors.

Paul McDougall, Editor At Large, InformationWeek

May 5, 2010

2 Min Read

Contrary to a published report quoting a senior manager, IBM said it has no plans to dramatically reduce the size of its global workforce over the next several years.

IBM head of Human Capital Management Tim Ringo told industry publication Personnel Today that the computing and services giant is on a path to shrink its worldwide, full-time employment base by a whopping 75%--from about 400,000 workers to 100,000—by 2017.

"There would be no building costs, no pensions, and no healthcare costs, making huge savings" Ringo told the publication, in a report dated April 23rd.

Ringo suggested IBM would fill gaps created by the layoffs by employing many of the affected workers as non-employee contractors, on an as-needed basis.

But an IBM spokesman on Wednesday shot down the report, saying IBM has no plans for a mass workforce reduction.

The spokesman said Ringo's quote, while literally accurate, was meant to be a general characterization of the benefits of so-called crowdsourcing—under which companies dole out work to individuals on a project-by-project basis.

"I don't think there is any question he made the comments, but he would contend that his comments were reported out of context," said the spokesman, in a telephone conversation with

The spokesman added that Ringo "is not part of our HR function and has no decision making responsibility within HR." Rather, Ringo provides human resources consulting to IBM's customers.

IBM's spokesman added that the company has been consistently increasing its global headcount. "His comments run counter to an eight-year history of growing our workforce," said the spokesman.

IBM's total headcount stood at 399,409 at the close of 2009, up from 315,889 in 2002. The company no longer provides employee numbers specific to the U.S., where IBM has cut jobs (2,901, according to the employee group Alliance@IBM) in some areas and added positions in others in recent months.

About the Author(s)

Paul McDougall

Editor At Large, InformationWeek

Paul McDougall is a former editor for InformationWeek.

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