72 in state to lose jobs in newest cuts at IBM
Stepping up an overhaul of its big technology services business, high-tech conglomerate IBM Corp. yesterday notified 1,570 employees worldwide that their jobs are being eliminated.
The cutback follows a similar move early this month, bringing the total of technology services layoffs at IBM, based in Armonk, N.Y., to 3,023 in the second quarter and 3,720 since the start of the year. The cuts amount to roughly 1 percent of IBM's global workforce.
In Massachusetts, where the company is one of the largest private employers in the technology industry, IBM issued layoff notices to 72 of its 5,000 employees yesterday. Last month, the company idled 16 employees in the state, bringing its total employment cuts for the quarter to 88, or about 1.6 percent of its Bay State workforce.
Most of the state layoffs were in IBM's services group, though a small number were in software and sales, said IBM spokeswoman Elena Fernandez . She said the job cuts reflect an ongoing shift in technology services, where IBM still has a $115 billion backlog.
"The nature of the services business is one where there's regular turnover," Fernandez said. "We're always looking to make things more efficient and cost effective, and there's an element of automating."
Technology services leaders like IBM and Accenture, which design and provide specialized software and business processes for other businesses and consult with them on efficiencies, have been struggling to fend off price competition from Indian outsourcing firms, analysts said. Toward that end, the global providers have been building up their own low-cost sourcing networks in India and elsewhere.
Even as IBM has eliminated more than 3,700 services jobs this year, it has hired 19,000 employees . The company would not give a geographic breakdown of where new employees are being hired.
"Clearly, this is part of an ongoing attempt by IBM to alter its skill sets and cost structure by moving some implementation resources offshore," suggested Michele J. Cantara , a vice president for research at technology research firm Gartner Inc. in Chelmsford.
Of the IBM employees in Massachusetts, where the company has grown through acquisition over the past decade, more than two-thirds work in software development, with the rest in sales and services.
IBM operations in Cambridge, Lexington, Westford, and Marlborough together make up its largest software cluster in the world.
Robert Weisman can be reached at weisman@globe.com. 
