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IBM looks to lay off 5,000 US workers

IBM Corp plans to lay off about 5,000 United States employees in a new round of job cuts, The Associated Press has learned.

The move reflects IBM's aggressiveness in shifting labor to lower-cost regions like India and keeping its profit aloft at a time when other technology companies' earnings are tumbling.

An IBM manager knowledgeable about the plans said the cuts will come from the services division and workers were to be informed yesterday. The person spoke on condition of anonymity on Wednesday because he was not authorized to discuss the plan publicly.

The layoffs were reported earlier by The Wall Street Journal.

The cuts will affect about 4 percent of IBM's US-based work force, which totaled 115,000 at the end of 2008. In a sign of how quickly IBM is staffing up in emerging markets, last year IBM had nearly as many workers in Brazil, China, India and Russia - 113,000 - as it did in the US.

IBM now has about 400,000 employees worldwide.

Unlike many other tech companies that have recently announced layoffs, IBM has managed to become more profitable despite the recession.

IBM's cost-cutting, global footprint, and focus on services and software, which are often more lucrative than hardware, are key reasons why. BM's net income was up 18 percent last year to US$12.3 billion.



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