IBM is gearing up for a major cost-cutting programme which will see 13,000 redundancies in Europe. However, it is still unclear how the cuts will affect the US multinational's Irish operations.
The company is a major employer in the Republic's technology sector and a key player in the industry. It employs 3,700 people here, mainly at its technology campus in Mulhuddart, Dublin.
An IBM spokesman at the company's Irish operations was unable to say last night how the swingeing cuts would affect Ireland. Nor was he able to clarify when the cuts would take place.
However, IBM spokesman John Bukovinsky was quoted as saying that most of the job cuts in Europe would be voluntary and that talks had begun with workers councils and other organisations on the timing of these actions.
The company said it plans to make the voluntary and involuntary job cuts during the second quarter.
IBM, which is the world's largest computer company, employs 100,000 in Europe, so it is unlikely that Ireland will escape the radical restructuring programme unscathed.
The programme, first mooted earlier this year, will result in a pre-tax charge of $1.3 billion (€1 billion) to $1.7 billion. IBM said it was restructuring its operations to better focus on high-growth markets.
The company's Irish operations comprise five divisions: They are manufacturing, software development, treasury, services and an e-business unit.
When news of the restructuring broke earlier this year, there were suggestions that some facilities would be closed and moved to Hungary and the Czech Republic.
IBM employed 329,000 staff worldwide at the end of 2004, the last time the company disclosed its total workforce figures. On that basis the loss of 13,000 jobs would represent a 4 per cent cut.
Last month, IBM had confirmed it planned to lay out a restructuring plan, including job cuts, following a bombshell earnings announcement, in which it blamed disappointing profits and sales on economic weakness in key European markets and Japan, as well as its own problems closing deals.
IBM reported a profit from continuing operations of $1.4 billion in the first quarter compared with $1.36 billion a year earlier, below expectations. The company said that sales increased just 3 per cent from a year ago. Analysts were forecasting a 6 per cent increase.
