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Laid off while the fat cats rake in profits
Job massacre at IBM

By Helen Scott | June 21, 2002 | Page 2

"BODY BLOW." "Massacre." These are the words that come to mind for workers at the computer giant IBM's microelectronics plant in the Vermont town of Essex Junction, near Burlington by the Canadian border.

In one of the biggest single job cuts in the state's history, IBM announced June 4 that it was laying off nearly 1,000 workers, including technicians, engineers, scientists, managers and workers in support services.

The layoffs are part of a plan for IBM to shed 1,500 jobs nationally from its semiconductor business--and come only a few days after news reports that the company had quietly downsized some 5,000 workers at a dozen facilities across the country.

The Essex Junction plant has a workforce of 8,000, so last week's cuts will have a devastating impact--not only locally, but across the state.

IBM workers described scenes of sobbing as they were told, one by one, whether they'd lost their jobs. Some of those fired had worked at the plant for decades--and now face the daunting prospect of job hunting late in life, in a tight labor market. Others worry about how they will meet mortgage payments, college tuition, health care costs or car payments.

Certainly, few of the available jobs meet the pay and benefits of the positions lost at IBM--and the ripple effects from the cuts at IBM are bound to lead to more layoffs as well.

Those remaining are being called the "survivors," and many feel grief, shock, guilt and fear--but also outrage. "People are traumatized and angry, while the fat cats at the top keep making money," lab technician Glen Taulton told Socialist Worker.

IBM claims that the layoffs are necessary because of decreased profits and growing competition because of a global slowdown in the information technology industry. But less than two months ago, IBM executives announced a plan to buy back $3.5 billion worth of stock.

[email protected], a Communications Workers of America affiliate that represents 4,000 IBM workers nationally, points out that this money could save more than 23,000 jobs.

In fact, IBM's Web site boasts about the corporation's financial situation. "Even within this tough climate, we generated $1.7 billion in pretax income, we had very strong services signings of more than $15 billion, and we believe we gained or held share in high priority segments," the site reads. "We're pleased that, despite the difficult business conditions, IBM continued to outpace the competition."

The reality is that top executives are getting rich while workers pay. For example, former IBM CEO Louis Gerstner raked in an estimated $366 million between 1997 and 2001 in salary and stock options. As chief of the computer giant, Gerstner is responsible for slashing workers' pensions--yet he himself got a $1.1 million-a-year retirement deal.

Other IBM executives will actually be rewarded for these layoffs, says Glen Taulton. "They'll claim billions as a tax write-off," he said. "This is corporate welfare at its finest."

Local politicians have paid lip service to IBM workers. But their solution--from right to left--is more corporate welfare.

Republicans are actually trying to use IBM's job massacre to win pro-business votes--claiming that the layoffs are the result of a climate that's unfriendly to business. This is nonsense, of course--IBM cut its workforce at 10 different plants across the country, not only in Vermont.

In reality, the state is slavishly pro-business. As Democratic Gov. Howard Dean recently boasted to reporters: "I've had 45 or 46 private meetings with IBM since I've been governor. And IBM has gotten pretty much everything they've asked for."

There's no end to what politicians have allowed IBM to get away with. As one activist put it in the local paper Seven Days: "IBM is not only the state's top polluter but also a nine-time winner of Governor Howard Dean's environmental achievement awards." Meanwhile, with local officials ignoring violations of worker safety at the Essex Junction plant, workers have had to resort to lawsuits over health problems related to toxic exposure at work.

The attacks at IBM aren't the exception--they're the rule in Corporate America. "It's a bigger picture than IBM," Earl Mongeon, an IBM employee, told Socialist Worker. "This is how all corporations are treating workers. There are multimillion dollar 'consulting firms' to teach management how to screw workers. They fire workers and make those left work harder. They squeeze you, then they fire you."

Mongeon believes that organizing to fight back is the key to dealing with IBM. "This will continue until we all unite and stand together, get a union and get a contract," he said.

Three years ago, when IBM tried to switch from its traditional pension plan to a cash balance plan, workers protested and forced IBM to back down. But the company then divided the workforce and weakened the movement for a union by allowing some workers to choose either plan.

Many workers at the Essex Junction plant are involved with an organizing drive with [email protected] Now more than ever, the union has to come through with paid organizers and financial support.

Unity within the workplace and solidarity with other workplaces are key. As Mongeon says: "You've got to get out there in numbers and show you're not afraid to exercise your right to protest."

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