IBM Corp.”™s latest round of layoffs isn”™t expected to have much effect on the local economy, according to one industry expert.
IBM last week said it is laying off 450 workers, 300 of whom are based at its Poughkeepsie and East Fishkill facilities. Anne Conroy, president of the Dutchess County Economic Development Corp., said the impact on the local economy would be minimal, given that the corporation maintains a work force of 11,865 at the two plants, a level that is still above the employment levels of 2004 and 2005.
The positions are in the areas of supply chain management, packaging and testing, and technology development in the company”™s microelectronics division, according to IBM spokesperson Glen Thomas. (Ninety of the layoffs are occurring at its plant in Burlington, Vt., with the rest scattered across the nation.) The cuts are the result of a strategy to eliminate redundancies in the manufacturing and technology development units of its microelectronics business, which are being merged into a single entity, he said.
“We”™ve gone through a similar process in other parts of our system,” including mainframes, UNIX and data storage, he said. “This was a very staged and planned transition.” Thomas said some of the laid-off employees would likely find positions elsewhere in the company, given their level of skills. All the affected employees are being offered severance packages, including one week”™s pay for each six months worked as well as transitional medical coverage and placement services.
Such shifts are part and parcel of today”™s technology-driven, globally competitive economy. “Business priorities change. You get new clients, new needs, a demand for new skills,” Thomas said. So while the company might be cutting jobs in one division, it simultaneously could be hiring in another.
Conroy said she agreed that “this is the way businesses have to compete.” She noted that IBM added “hundreds of jobs last year.”
“I don”™t think (the layoffs) are cause for alarm. They reflect today”™s competitive environment.” On the positive side, “IBM is an attractor that brings in other partners to its site. I think the impact on the county economy will be minimal.”
She added that the region is doing well economically. Private-sector employment in Dutchess County and the Hudson Valley is expanding significantly and unemployment remains low.
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