According to the sources, one of the insiders has confirmed that Indian Business Machines Corporation (IBM) carried out ‘massive layoffs. News Website The Register reported that the company has reportedly been cutting thousands of jobs this week, thus impacting the IBM Cloud division particularly.

The reports also revealed that the employees were forced to sign a non-disclosure agreement (NDA) secretly. One affected employee of IBM was quoted as saying, “This was very different from traditional layoffs.” It is estimated that the number of layoffs disclosed probably constitutes only a percentage of the job cuts.

IBM’s Director Of Human Resources On Job Cuts

Lawrence Sposato, IBM’s director of human resources in the US, confirmed in a letter to the Employment Development Department (EDD) that they have made a permanent reduction in force in San Francisco’ His decision comes amid rising concerns regarding the company’s workforce strategy moving forward.

Impact On India

IBM acknowledged that the company is letting people go but downplayed the gravity of the situation. The company revealed a $400 million ‘workforce rebalancing’ charge in its first-quarter 2024 earnings report but described the move as part of the broader restructuring effort and that lay-offs are a part of it.

When requested about the exact number of layoffs and plans on hiring, IBM’s spokesperson did not pay heed. The job cuts mainly targeted senior-level programmers, sales, and support people, the reports revealed.

However, the hiring is reportedly continuing in India as of now.

Is AI Driving Force Behind Cuts?

The total number of job cuts however remains unclear. In a previous statement, CEO Arvind Krishna indicated that the number could be close to 8,000 employees. He stated earlier that AI would cut around 7,800 IBM jobs in the coming years.