IBM culls 190 jobs as China takes business

IBM IS to cut 190 jobs as it closes its manufacturing business in Dublin by March, transferring operations to China.

The move has been flagged for some time as the focus of IBM’s Dublin technology campus has switched from manufacturing of hardware products to software and services in recent years.

In a statement yesterday, IBM said it planned to move its low-end/mid-range server manufacturing operations from Mulhuddart in Dublin to Shenzhen, China, by March next. This will mean there will be no hardware manufacturing left in Dublin.

“This change will place us closer to our growth markets and suppliers, while providing greater operational efficiency and cost savings,” the company said.

It is understood IBM will seek to redeploy as many of the affected workers as possible to other areas of its business. However, a number of employees will be forced to take a redundancy package.

It is understood that as many as one-third of staff were redeployed within IBM when other manufacturing functions moved to Asia in recent years.

The first workers are expected to leave the company in February.

Fine Gael Dublin West TD Leo Varadkar described the move as “devastating” for workers and their families.

“Alongside the pain these job losses will cause, IBM’s announcement heralds the end of hardware manufacturing in the area,” he said.

“Ireland should be attracting jobs in these blue-chip, high-tech companies, but instead workers are seeing them shipped abroad to countries such as India and China. This does not bode well for Fianna Fáil’s and the Greens’ attempt to build the smart economy.”

He called on IBM to provide affected workers with a “generous redundancy package” as the firm had benefited from low tax rates and government grants in previous years.

IBM is understood to be offering workers a package that includes about five weeks’ pay for every year of service.

Earlier this year the company announced that it was transferring manufacturing of high-end servers to Singapore. An additional 120 jobs were shed when the transfer to the Far East was first announced in February 2009.

In April, IBM sought 310 voluntary redundancies at its Dublin manufacturing facility. However, in March it announced it would create 200 jobs in Dublin with the establishment of a research centre to look at technologies to help manage cities.

The company employs more than 3,000 people in Ireland. This figure has remained broadly static despite the loss of 620 manufacturing roles since February 2009.

In addition to redeploying staff and the creation of new roles, a significant number of workers have transferred to IBM as a result of outsourcing contracts it has signed with customers.

Just over 200 O2 staff transferred to IBM in 2008 when the telecoms company outsourced its technology function to the US firm.