IBM Says State Business Climate Not Liable for Layoffs

06/06/02 12:00AM By Bob Kinzel
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(Host) IBM officials said Wednesday that there was nothing the state of Vermont could have done to affect the company's decision to reduce its workforce by nearly 1,000 people. The officials say an international slowdown in the demand for computer chips and a reorganization of the company are the major factors driving the decision.

VPR's Bob Kinzel reports.


(Kinzel) One of the key questions being asked across the state is whether or not there was anything the State of Vermont might have done to avert the massive job cuts that were announced by IBM on Tuesday. There's no doubt that this question will become a central focus of Vermont's upcoming political campaigns.

Some critics of the Dean administration are already charging that the state should have been more pro-active with IBM and taken steps to deal with some of the company's chief concerns, such as building the circumferential highway in Chittenden County, lowering power costs and simplifying the process for permits.

But IBM officials insist that none of these actions would have had any influence on the decision to cut almost 1,000 jobs at the Essex Junction plant. IBM Communications Director Jeff Couture says the cuts are the direct result of changes in the computer field and have nothing to do with Vermont's business climate:

(Couture) "There was no particular action that the state did or did not do that impacted or caused the layoffs that we announced. These actions were based on the conditions in our industry today and our efforts to realign our business for future success and growth."

(Kinzel) Couture says the reorganization reflects a shift in policy for the kinds of products that are manufactured in Vermont such as phasing out its aluminum based chip products:

(Couture) "So we're moving out of that and we will be moving out of a few other product lines and activities that we were doing and instead trying to target our business to do some other areas, areas that we're involved here in Vermont that we think are going to be better growth and profit opportunities for us."

(Kinzel) There are rumors swirling around IBM that the company will cut another 1,000 jobs by the end of the year. Couture says there are absolutely no plans to do that:

(Couture) "There's certainly no intention in the announcement to turn around in the near term to come back with some other cuts or some other changes. I think the announcement is to say these are some difficult, important steps that we needed to take and from here we're going to move the business forward."

(Kinzel) Under federal law, the employees being cut had to be given a 60-day notice before their jobs can be terminated.

For Vermont Public Radio, I'm Bob Kinzel in Montpelier.
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