Companies Like IBM Should Disclose Scope of Global Activities

Ann All

Last March I wrote about what some folks called IBM's "stealth layoffs." Labor experts cited IBM's actions as an illustration of the need for an overhaul of the federal WARN (Worker Adjustment and Retraining Notification) Act, which requires advance notice of large layoffs. While IBM's North American job cuts were believed to be in the thousands, notice wasn't required because the steady cuts occurred over a period of time and at different locations. While IBM was quietly cutting large numbers of American jobs, it was beefing up its workforces in low-cost labor countries like India.


Perhaps due to negative PR associated with increasing foreign jobs while cutting domestic ones, IBM has stopped providing global breakouts of its workforce, reports InfoWorld. In its latest annual report, the company says it has 399,409 employees worldwide, up 0.2 percent over 2008 levels. According to data submitted as part of congressional testimony, IBM employed 105,000 in the U.S. last fall, down from 121,000 in 2007.


The Alliance@IBM/CWA Local 1701, an organization seeking bargaining rights for employees, believes IBM laid off about 10,000 U.S. workers in 2009. Big Blue recently conducted another layoff, which the Alliance estimates involved 2,900 jobs..


The InfoWorld report cites a note from an IBM spokesman, in which the spokesman says "our competitors report headcount globally. Going forward we will report it globally."


Ron Hira, an associate professor of public policy at the Rochester Institute of Technology, told InfoWorld actions like IBM's make it difficult for elected officials and others to understand offshoring trends. He said:


By hiding its offshoring, IBM is doing a disservice to America -- through omission the company is providing misleading labor market signals and information to policy makers.


In my post from last March, I called for more transparency in global employment data. I wrote:


As I've found when writing about H-1B visas, there is often a dearth of this kind of data. A flurry of surveys with conflicting data published last spring seemed to indicate that few U.S. companies knew how much work they sent offshore. In a global economy, this seems like the kind of information that investors, consumers and others should be entitled to know.


If companies like IBM believe that globalization is a key part of their success moving forward, they need to openly make that case instead of trying to conceal the scope of their global activities.

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