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IBM should reveal truth about engineering layoffs

Posted: 06 May 2009     Print Version  Bookmark and Share

Keywords:offshoring  high-technology company  engineering jobs 

Perhaps more than any other U.S. high-technology company, IBM Corp. has been subjected to intense media scrutiny in the aftermath of a string of recent under-the-radar layoffs. Much of that unwanted attention is a direct result of union activism that has taken on a decidedly "we're mad as hell and we're-not going to take it anymore" tone. Following an IBM shareholder meeting last week, fighting words like "greed" were being lobbed like hand grenades.

For its own reasons, IBM executives continue to say little about company layoffs. That policy has backfired, attracting still more scrutiny and criticism.

Instead, IBM has launched what appears to be a counteroffensive intended to defuse union criticism of its estimated 10,000 layoffs (a union estimate) and the offshoring of U.S. engineering jobs. For example, the company announced last week that it would create a network of "analytic centres" that would employ up to 4,000 analytics consultants. Good news, unless you're a laid-off engineer.

IBM is hardly alone in seeking to cut labour costs by shipping jobs overseas, but the timing and handling of its personnel moves have been seized upon by its critics as engineering unemployment has soared.

We have asked IBM about its recent layoffs, but the company has declined to comment. For the record, J. Randall MacDonald, IBM's senior vice president for human resources, told The New York Times in March that it is routine for the company to lay off some employees while hiring elsewhere. "This business is in a constant state of transformation," MacDonald said. "I think of this as business as usual for us."

The Times article also chronicled how IBM and other companies have scattered their layoffs, presumably to remain under the radar as worker rage intensifies.

Former IBM workers provide a different perspective from MacDonald's, noting that the company reported strong quarterly results in January. One engineer recently laid off by IBM told the Times that the company is using the downturn "as an excuse to lay people off."

Offshoring debate
The nasty tone of the offshoring debate is a symptom of economic uncertainty and plain old fear about the future. Workers, especially engineers, see no end to the mounting pile of pink slips. Many U.S. corporations are now so fearful of a backlash that an unprecedented number of high-tech H-1B visas for fiscal 2009 have gone unused. Industry backers of H-1B point to the current surplus of high-tech visas as an indication that market forces have corrected any abuses of the programme.

Union officials would counter that H-1B visas represent a government subsidy to industry that ultimately allows it to ship skilled jobs with decent wages overseas in the name of saving labour costs.

Legislation introduced in the U.S. Senate on April 23 seeks to reform the H-1B and L-1 visa programmes by stamping out industry abuse and fraud.

"The H-1B visa programme should complement the U.S. workforce, not replace it," Sen. Richard Durbin (D-Ill.), who co-sponsored the proposed H-1B and L-1 Visa Reform Act with Sen. Charles Grassley (R-Iowa), said in introducing the legislation.

The 210,000-member IEEE-USA said last week that it supported the legislation. In a letter to Durbin and Grassley, the engineering group reiterated its position that permanent, skills-based immigration is "a more appropriate strategy than temporary visas to help meet the workforce needs of the U.S. high-tech industry."

Other industry groups argue that IEEE-USA's position doesn't go far enough. While some engineering groups are likely to support the spirit of the H-1B reform bill, many can be expected to question the continuance of a programme that is deeply resented by the engineering rank and file in the United States.

We will continue to cover both sides of the offshoring debate. In the meantime, the public discourse on the jobs issue would be better served if high-tech companies like IBM were more forthcoming about their employment policies, particularly offshoring.

Corporations and their workers must find common ground if the U.S. technology industry is to climb out of the economic morass.

- George Leopold
EE Times

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