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IBM Singapore lays off workers from its Tampines plant

SINGAPORE — Hundreds of IBM Singapore employees are being laid off, amid the technology giant's global restructuring efforts.

IBM Singapore lays off workers from its Tampines plant
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SINGAPORE —Hundreds of IBM Singapore employees are being laid off, amid the technology giant's global restructuring efforts.

The firm is cutting manpower from its Singapore Technology Park, a manufacturing plant at Tampines, as it is relocating manufacturing of its Power Systems product to a facility in Guadalajara, Mexico.

IBM staff and subcontractors told TODAY that at least 200 people were being laid off, and they comprised Singaporeans and foreigners working in a variety of positions. They included blue-collar workers, professionals, managers, executives and technicians (PMETs).

Headquartered in New York, the tech firm declined to reveal the number of layoffs in Singapore, and it said in an email reply to TODAY's queries that the move is part of its "continual review of the most efficient way to source our products".

According to IBM workers and subcontractors TODAY spoke to, several rounds of retrenchments have been carried out in the past few months.

Three such exercises have been conducted so far, said a staff working for IBM's subcontractor — who declined to be named — who is currently serving his notice until the end of the month. The first and second retrenchments were carried out in May and June respectively, and a third round will take place at the end of July.

While IBM Singapore did not reveal the number of staff working at its Tampines facility, a source told TODAY that the manufacturing activity moving from Singapore to Mexico accounts for 60 per cent of the workforce there.

An IBM engineer, who did not wish to be named, said that about 30 to 40 per cent of total staff were being retrenched. The engineer's contract termination date was brought forward to the end of July. It is estimated that there are about 400 to 600 people working in the facility, according to workers TODAY spoke to.

The manufacturing plant at Tampines opened amid much fanfare in 2010, with the inauguration ceremony officiated by then-Finance minister Tharman Shanmugaratnam. The S$90-million, 365,000 square foot facility was meant to serve high-end systems clients across Asia, Africa, and Europe.

When asked if it planned to sell its Tampines facility, IBM Singapore said that it "continually assesses optimum space utilisation for its operations", and has not come to a decision on the future use of the space.

The American computing firm said that Singapore remains a strategic location for the company as the manufacturing of its mainframe computers, System Z, will continue at the Singapore Technology Park.

Other IBM investments in Singapore, such as its Integrated Supply Chain Manufacturing Centre, Cloud Data Centre and Services Integration Hub, are not affected.

According to several media reports earlier this year, IBM had planned to slash 10,000 staff from its global workforce, and re-assign another 30,000 to new roles as part of its restructuring of its Global Technology Services division.

The tech giant reported better-than-expected second quarter earnings on Wednesday (July 18), with overall revenue rising by 4 per cent to US$20 billion (S$27.3 billion) — its third straight quarterly increase after nearly six years of decline.

More than half of its revenue came from its newer businesses such as cloud computing and artificial intelligence, which has been the company's focus as it attempts to offset weaknesses in its traditional business of hardware and software sales.

Responding to TODAY's queries, a Ministry of Manpower spokesperson said: "We do not comment on any impending or speculative restructuring exercises of any company."

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