IBM Rethinking Cherished Policy Of No Layoffs: IBM Starts Rethinking ...
The computer industry slump, sagging profits and concerns about future growth are forcing a painful internal examination of IBMÛªs cherished Û÷Û÷full-employmentÛª' no-layoffs policy, and raises serious questions about whether the worldÛªs biggest computer company is overstaffed, analysts said.</br></br>With more than 405,000 employesÛÓ242,000 of them in the United StatesÛÓInternational Business Machines is one of the worldÛªs largest employers. It is one of a handful of technology companies with a tradition of avoiding layoffs.</br></br>While other multibillion-dollar corporations with paternalistic practices, such as Eastman Kodak Co., Xerox Corp. and E. I. DuPont de Nemours, have dramatically cut their blue-collar and middle-management ranks in recent times, IBM "remains fully committedÛ to full employment, said IBM Chairman John F. Akers.</br></br>But at an analysts meeting in San Jose, Calif., last week, Akers aknowledged there would be a drop in the U.S. work force by the end of this yearÛÓthe first such year-to-year decline at the company in 11 years. An IBM spokeswoman said, "IBMÛªs objective is to reduce IBMÛªs U.S. employment.Û Û÷TheyÛªre overmanned, which means theyÛªll continue to be in an attrition mode,Û said J. Quinn Mills, a Harvard Business School professor and occasional consultant to IBM. "The most pessimistic case is that this computer recession will deepen and that they will not be able to Û÷attritÛª people fast enough.Û</br></br>IBM has a hiring freeze in forceÛÓnew hires have dropped from a record 18,500 in 1984 to a projected 2,500 to 3,000, ÛÏmainly technicalÛ hires for 1986ÛÓand is counting on attrition to trim IBMÛªs U.S. employes.