IBM Lays Off More Vermont Workers

Roughly 140 employees at IBM's Essex Junction plant lost their jobs this month, the most recent bout of layoffs in the company's billion-dollar restructuring. The company currently employs over 430,000 people worldwide, but some analysts expect that number to shrink by roughly 13,000.

Many of these employees work under IBM's Systems & Technology Group, which some analysts expect to shrink by 25 percent.

IBM isn’t just reducing its workforce; selling its manufacturing assets, like the Essex plant, is an integral part of “Project Apollo.” The company sold its low-end server division to Lenovo earlier this year, and hopes to sell another chip plant in East Fishkill, NY.

Chief Executive Officer Ginni Rometty says the company, which has endured seven consecutive quarters of declining revenue, needs to invest in 'priority areas' such as cloud computing, analytics and cognitive computing.

"IBM continues to rebalance its workforce to meet the changing requirements of its clients," stated Rometty in a press release.

The layoffs are roughly one-third the size of those last summer, when 419 workers were laid off. Vermont Labor Commissioner Annie Noonan said that the labor department hopes to institute a 'response team' to assist those who lost their jobs.

After last year’s cuts, Noonan's department petitioned the US Department of Labor to include the ex-workers in the Trade Adjustment Assistance program. The request was initially approved for those at the Williston campus, but was extended this week to the workers at Essex Junction.

The recovery program provides up to 130 weeks of job training and unemployment benefits, and focuses on reintegrating workers older than 50 back into the workforce.

"With the steady increase in the economy," Noonan stated, "we are quite hopeful that we can assist the laid-off workers find jobs with other Vermont companies."

Currently, Vermont employers must inform the state about substantial layoffs just 24 hours before they take effect. In order to mitigate financial fallout and petition for federal aid, The Shumlin administration hopes to pass a law extending this period to 90 days.

David Sunderland, chairman of the Vermont Republican Party, criticized the administration for not addressing this issue sooner. Sunderland believes that statewide layoffs are indicative of a larger problem in Vermont.

Just last week, automotive company Plasan Carbon Composites announced that it would close its Bennington facility. Even if both layoffs reflected evolving business models, Sunderland believes that Vermont must do more to incentivize higher paying industries to stay here.  "It is clear the economic troubles in Vermont are deepening,” Sunderland stated in an interview.

Although he was relieved that the layoffs were smaller than last year, Lt. Governor Phil Scott was also wary of waiting "another second" to address the economy. "The fact of the matter is more than 100 Vermonters are losing their well-paying jobs," stated Scott in a press release. "The trend of job losses over the last two years is concerning."