Tech behemoths IBM and HPE have announced a slew of job and salary cuts in an attempt to control the damage caused by the COVID-19 pandemic.
While the exact number of layoffs is unknown, a MarketWatch report suggests that it is likely to be in the thousands. In a bid to cut costs by $1bn this year, HPE has unveiled drastic salary cuts as well.
“IBM’s work in a highly competitive marketplace requires flexibility to constantly remix high-value skills, and our workforce decisions are made in the long-term interests of our business,” the US technology major said in a statement.
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According to a Register (opens in new tab) report, almost all HPE personnel’s salaries will be reduced, with only front-line sales workers being exempt. The higher the position, the greater likely the percentage drop.
“The global economic lockdowns since February significantly impacted our fiscal Q2 financial performance,” said HPE CEO Antonio Neri. “We are taking decisive steps to navigate the near-term uncertainty, while ensuring we align resources to prioritize growth areas so that we are well positioned to accelerate our edge-to-cloud strategy and address the needs of our customers in a post-COVID-19 world.”
In a statement sent to CRN, an IBM spokesperson cited the extension of medical insurance benefits for employees recently let go. “Recognizing the unique and difficult situation this business decision may create for some of our employees, IBM is offering subsidized medical coverage to all affected US employees through June 2021,” said the spokesperson.