Why Has IBM Changed Its Tune and Announced Local Hiring?



IBM’s plans to hire and spend $1 billion in training

Earlier in this series, we discussed how Donald Trump’s policies could weigh on the technology sector and IBM (IBM). Like its peers, IBM is known for its acquisitions and layoffs. However, December 2016 saw IBM making news when it announced that it would be hiring 25,000 US workers in 2017 and plans to spend $1 billion in training over the next four years. IBM clarified that this announcement is not a commitment, but a plan to boost hiring if business conditions remain favorable in the near future.

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Factors that urged IBM to announce hiring

In the recent past, IBM was accused by Trump of depriving the United States of employment opportunities. In response to IBM’s outsourcing of jobs to foreign countries, IBM CEO Virginia Rometty penned an open letter to Trump highlighting that IBM has been in operation for the last 105 years and is the largest technology employer in the United States.

She highlighted that IBM has hired more US employees than its peers in the last five years, and it still has thousands of vacant positions in cybersecurity, cognitive computing, AI (artificial intelligence), and data science. Amazon (AMZN), Intel (INTC), Oracle (ORCL), and Microsoft (MSFT), leading players in the cloud space, are also making investments in these spaces.

The above chart by Challenger, Gray & Christmas, an employment consulting firm, shows that the computer industry was only second to the energy sector in announcing layoffs. Highlighting the layoffs in the tech sector is nothing unusual, the firm said, stating that “Heavier job cuts in the tech sector this year have been more indicative of an industry that is in flux, as opposed to one that is in trouble. That is the nature of technology, so it is not unusual to see workforce volatility. Overall, the tech sector is about as healthy as it gets.”


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