The US technology giant IBM wants to close its research and development department in China. This will affect more than 1,000 employees, most of whom work in the laboratories.
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Jack Hergenrother, Vice President, Global Enterprise Systems Development of the US technology company, informed employees about the closure of their department at a virtual meeting on Monday morning, reports among others The Wall Street JournalAccording to Hergenrother, IBM is facing increasing competition in China: the infrastructure business has declined in recent years, and the research and development department should now be concentrated on different regions.
Increase in positions at other locations
IBM has already told some of the employees that it is increasing engineering and research positions at other locations, for example in India, the report says. The employees in question could therefore move to a location in another country for their jobs. Others have been offered severance pay under certain circumstances, reports the Financial Times citing two employees.
Most of the affected employees developed and tested products such as corporate software in the laboratories, which are spread across several Chinese cities. A spokesman for the technology group explained to the news agency Reuters: “These changes will not impact our ability to support customers across the Greater China region.” The company is adjusting its activities as needed to best serve its customers despite the closure of the site, IBM said, according to media reports. The company did not provide any further details, including on the layoffs.
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