IBM Layoffs: 10,000 Jobs Cut in Europe Amid Hybrid Cloud Shift

Following a significant strategic realignment, Bloomberg reported this morning that IBM is planning to reduce its workforce in Europe by approximately 10,000 positions. This announcement follows the company’s recent declaration that its infrastructure services division will be established as a separate entity next year. Although IBM did not directly acknowledge the reported job cuts, a company representative indicated that substantial organizational restructuring is underway as the company prioritizes a hybrid cloud strategy.

Responding to inquiries regarding the Bloomberg report, IBM stated: “Our workforce adjustments are designed to optimally support our clients in their adoption of an open hybrid cloud platform and artificial intelligence solutions. We are also continuing to make considerable investments in the training and professional development of IBM employees to effectively address the evolving requirements of our customer base.”

This suggests that employees lacking the skills currently in demand may be impacted by the changes at IBM. IBM Chief Executive Officer Arvind Krishna touched upon this evolving landscape during a recent interview with Jon Fortt at the CNBC Evolve Summit, stating:

The pattern surrounding IBM workforce reductions has consistently involved the elimination of roles that are no longer aligned with the company’s evolving business model, and the current report appears to continue this trend, according to Holger Mueller, an industry analyst at Constellation Research.

“IBM is undergoing its most substantial transformation in its history, shifting its focus from services to software and specialized hardware, including Quantum computing. This transition necessitates a different skillset within its workforce, and the resulting impact is reflected in the layoffs IBM has been implementing, largely without widespread publicity, for the past five years,” he explained.

These changes present challenges for those affected. Losing employment is never easy, and the current economic climate amplifies the difficulty. The timing of these cuts is particularly challenging, occurring amidst a recession triggered by COVID-19 and as Europe experiences a resurgence of the virus.

We have previously covered several instances of IBM workforce reductions over the last five years. In May, the company confirmed layoffs without disclosing specific numbers. In 2015, we reported on a reduction of 12,000 employees.