According to CNBC, IBM is cutting a “low single-digit percentage” of its global workforce in the fourth quarter of 2024. The company employed 270,000 people at the end of last year, meaning even a 1% reduction would eliminate about 2,700 jobs. CEO Arvind Krishna confirmed the cuts while attending an AI forum on Capitol Hill in September. IBM’s spokesperson said the company anticipates U.S. employment will remain flat year over year despite the workforce reduction. The layoffs come as technology companies continue trimming headcount to improve productivity through increased reliance on artificial intelligence tools.
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What This Means for IBM
Here’s the thing about these “low single-digit percentage” cuts – they’re becoming the new normal in tech. IBM isn’t just randomly trimming fat; they’re strategically reshaping their workforce for an AI-heavy future. And honestly, when you’ve got 270,000 employees worldwide, you can cut thousands of jobs and still call it a “small percentage.”
But let’s be real – this isn’t just about cost-cutting. IBM has been pushing hard into AI and hybrid cloud services, and they’re probably reallocating resources toward those growth areas. The fact that they’re keeping U.S. employment flat suggests they’re being careful about optics while still making the changes they need.
The Bigger Tech Trend
Look, IBM isn’t alone here. We’ve seen similar moves from dozens of tech companies over the past couple years. Basically, everyone’s trying to figure out how to do more with less – and AI is the tool they’re betting on. But here’s the question: are these cuts about efficiency, or are they preparing for tougher economic times ahead?
What’s interesting is the timing. Fourth quarter cuts are unusual since companies typically want to end the year strong. This suggests IBM sees some urgency in making these changes now rather than waiting until 2025.
Impact on Tech Workers
For the people affected, this obviously sucks. But here’s something worth noting – the tech job market has actually been recovering lately. Skilled workers from companies like IBM often land on their feet pretty quickly, especially if they have experience with AI and cloud technologies.
The bigger concern might be what this signals about the industry’s direction. Are we seeing a fundamental shift toward leaner tech companies that rely more on automation? Probably. And that could mean fewer traditional tech jobs in the long run, even as new types of roles emerge.
So while 2,700 jobs might seem like a drop in the bucket for a company IBM’s size, it’s part of a much larger transformation happening across the entire tech sector. The companies that survive will be the ones that figure out how to balance human talent with AI efficiency.
