Thread regarding IBM layoffs

@p6

I don't disagree with you, but my point was slightly different.

Unemployment rate is political (= has political implications, that is), so when unemployment numbers will start to go up and show in the stats meaningfully or substantially, the impact of all of this will then be different.

Meaning, tech workers had (historically, of course this may change) relatively high salaries, so tech jobs get reduced and salaries go down (the folks that they are hiring are not being offered "what used to be"), unemployment goes up, overall consumer consumption is also felt, economy slows down, growth goes down (perhaps a recession?)

I was going in that direction, per the above.

I fully agree with you that the bonanza for India and the like is only short term. It's a "for right now" phenomenon for those other markets too (were some jobs are moving short-term).

Jobs may be created over there right now, but they are ALSO lost.

Hire a "consultant" (or similar) from certain markets?,Can they offer any know-how of value or quality? So the big 4 (or the big whatever number, big 6, 8, 10... all of the ones "chopped by DOGE" IBM) will suffer in terms not just AI replacement but short term quality? if clients start getting on calls with people from other time zones (trying to be polite, as it's pure business logic), nothing else) would they find the value or would it be a call center of another kind?

@p0 AI is nothing more than a productivity tool to replace mundane tasks (commodity labor) with electrons moving at the speed of light. Folks would call it progress and progress always beats a path to every business’s door. It’s not political, but rather efficiency.
As to your other question “is IBM moving fast”

The short answer is NO, they are moving slow.
Why do I say that? It’s because currently IBM is replacing expensive labor with commodity labor, and just toying around the edges with AI (coding comes to mind). In 1-2 years you will see India complain just like folks in NA or Northern Europe are doing now, but the equation will be electrons are replacing commodity labor. Like it or not, it’s called progress or efficiency, and it’s here to stay. NOTE as quickly as India’s headcount went up, AI will reduce it back to what it was years ago.
Net net AI is borderless and non-political and it will greatly reduce not just IBM’s head count but almost all of techs headcount.

@nx

What do you think about the administration may soon react to all of the tech layoffs more strongly?

Independent from what side of the aisle one may be, if unemployment numbers go up, President Trump will not like it, so he would react more strongly? Even the interest rate-Powell saga will not be enough at this point.

If the administration is pushing for AI made in America, energy, etc... but these companies take advantage on one hand, while doing this on the other.... then what?

Do you think they (Alvind and Gang) are trying to move fast before s@%t hits the fan (based on the above)?

It's really becoming a real problem, as it's no longer IBM....

@n7 You have pretty much hit the nail on the head as to how IBM values employees. The net is employees cost on average approx 2/3’s less in India vs NA or Northern Europe. So if you are the CFO, and have to allocate talent to tasks, 2/3’s less will always be the choice. NOTE IBM continues to practice this quite aggressively. Just look at chart 30 from the past quarters performance. They took an 800 million dollar charge for restructuring (yep that’s 8k worth of headcount in 2nd q). Also note they took a 700 million dollar charge in 1st q. So in 2025 to date, 1.5 billion or 15k worth of restructuring head count has been disclosed, just buried in the details. Also note this behavior can’t continue forever due to IBM running out of eligible targets to go after. There is a base number of NA and/or Northern European head count that IBM can’t go below due to “govt contracts, face to face marketing and sales, TSS employees, newly acquired SW purchases, and finally labs and plants” Where is the bottom? Kyndryl says it’s at 8% of worldwide headcount being on shore, but they don’t have plants and labs, so you will have to do the math. I suspect for NA it’s in the 25-30k range

Alvind and Krabanaugh both need to lose weight

I’ve definitely noticed it on Alvind. He looks bloated and tired all the time

The overall cost of an engineer in the US (overhead, which includes social security, Medicare, cost of real estate, core salary, other benefits, etc..) could be $250k per year or more; if this job doesn’t involve innovation and can be done somewhere else for pennies on the dollar, this job will move overseas.
As opposed to true innovated AI jobs in which Meta , for instance, would pay millions for unique AI talent, that can’t be done anywhere else.
IBM CEO is essentially moving expensive jobs overseas when the job doesn’t involve innovation, which implies thousands of jobs at IBM. Tech industry is about talent and innovation: if a job can be done overseas it will

@jt but what exactly is the cost savings from these job movements ? That is the missing piece of the puzzle. Krabanaugh is hiding this information.

AI = Actually Indians. Just an excuse to move jobs to India. So in that regard he's correct that it won't eliminate jobs, just move them halfway around the world.

Bottom line, if you lose your job in North America, you have been replaced by multiple cheaper Indians or employees from low cost countries

IBM could have above 270k employees worldwide; it doesn’t mean the headcount went up in the USA ; to the contrary it went down in the USA and up in cheap countries like India etc… Americans employees are being replaced by cheaper younger ones in India and third world countries to save money to the bottom line

@hm while I agree with your premise and analysis, I also believe someone at IBM is cooking the books (Karapanaugh ?). If Alvind is transferring jobs to lower cost countries like India instead of keeping the jobs in higher cost countries like Western Europe, then there should be a net cost savings, unless someone is eating into the cost savings. How many AI staff eliminations are there in the US and how many AI jobs are being created in India (Alvind's preferred lower cost country) ? There needs to be more clarity (than there is) in all the targeted job eliminations and the job creations worldwide. But IBM has never been forthcoming about providing the numbers, as it would result in a lot of intense discussions.

Given the limited amount of information coming out of IBM (quarterly conf calls, and annual reports), IBM is getting the exact opposite of what it’s CEO is claiming. (282k head count worldwide going to 270 in 2024) Who thinks IBM in 2025 has hired above the 270k worldwide headcount, given the RTO policy’s, layoffs, and AI staff eliminations? AK your public pronouncements of increasing staff may be what you personally desire, but the facts show IBM’s headcount going down just as IBM enhances its use of AI. If it walks like a duck, and quacks like a duck, it most likely is a duck. Ai is nothing more than an efficiency tool to eliminate commodity labor (eg repetitive tasks)

@dt and how does he make his $100 million bonus for 2026 ?

LOL !

Alphabet Inc. (GOOGL): “I Got It Wrong,” Admits Jim Cramer

https://www.msn.com/en-us/money/markets/alphabet-inc-googl-i-got-it-wrong-admits-jim-cramer/ar-AA1Jm8Hx?ocid=msedgntp&pc=W099&cvid=29653200b4ed4ce2be124dc409d6388c&ei=20#comments

Alvind sounds like Jim Cramer

Whatever he says the opposite happens

@dr

What does AI Gemini replied when I asked "what does Gary Cohn think about jobs?"

"Gary Cohn, IBM Vice Chairman, stated on CNBC on July 16, 2025, that "the employment numbers continue to be relatively strong". In a June 18, 2025 interview, he also said that "the employment market stays relatively strong".

Cohn has expressed concerns about the broader workforce, highlighting the need to get people "back into the workforce". He noted that "labor demand is far outpacing labor supply". He also pointed out how labor shortages had impacted businesses such as Darden Restaurants and FedEx.

Regarding the impact of artificial intelligence (AI) on jobs, Cohn is optimistic. In March 2025, he stated that the "AI evolution creates more jobs, not fewer". He pointed out how automation through AI allowed a company to redeploy HR staff to more valuable positions while improving service. "

For AI Hallucination press #1, for Gary Cohn BS press #2.

A. Krishna recently said:”American students spend more than $250k on a college education and then I replace them with cheaper Indians; I report to the board and Wall Street pension funds; that’s how I make my $60 million a year compensation “

@dq

and none other than IBM's Gary Cohn sees the market getting soft this summer :

https://www.msn.com/en-us/money/other/this-summer-the-market-is-going-to-get-soft-says-ibm-s-gary-cohn/vi-AA1GXZlQ?ocid=msedgntp&pc=W099&cvid=688493ae5a6c41e1b9bac4c0cfa5242b&ei=25

What does that say to all the companies who are readying the axe for their employees going forward ? As the old Chinese proverb goes "May you live in interesting times".
Will AI save the world, Batman ?

@dc

That's right.

A friend just sent me a YouTube video of one of his friends (lost her tech job early this year) who was telling her followers how she is now living on a budget and cut down on all essentials 100%.

The example above multiplied by hundreds and hundreds of thousands is what's coming?

Tech workers have / used to have high purchasing power.

What these companies don't get is that they lose their high-power buyers because they laid them off, and they replaced them by low paid ones in other parts of the world, who will not be able to make revenue for them.

Just plain math.... doesn't work.

@de
for all the evil that Alvind has done during his term as CEO, he should be grabbing his ankles on the Armonk campus while getting a sound thrashing, so he won't sit down for a couple of weeks or more. He more than deserves it.

The same punishment should be delivered to Rometty and Palmisano who laid off thousands of good IBM employees to enrich themselves.

That’s just window dressing by Alvind

He will submit to his handlers on Wall Street as he’s eying 100 million in 2026

The goal of any companies today is to eliminate as many people as possible. They are just forgetting that these people are also consumers buying products and services that these companies offer. When there are a lot less consumers, there are going to be a lot less revenue for these companies.