President-elect Donald Trump’s adviser on jobs and the economy, Virginia Rometty, happens to be the chief executive of IBM, a company with a lengthy record of shipping jobs overseas. Ironically, Trump hired Rometty to advise him on how to prevent U.S. jobs from leaving the country.
Labor Department data show that IBM offshores aggressively although it rarely makes the news. Over the last two years, displaced workers applied for federal aid at the department at least two dozen times. All those workers lost their jobs because the tech giant moved their jobs to countries with low labor costs.
Trump Eyes Companies that Make the News
By contrast, United Technologies, the parent company of Carrier which Trump recently attacked for trying to send jobs to Mexico, had only one similar filling. Ford Motor has zero fillings even though the billionaire had blasted its plans to open new plants in Mexico.
Trump critics believe he bases his attacks on the information provided by the media rather than official documents. However, scores of U.S. companies ship jobs overseas without making the headlines.
Under the federal law, workers who was displaced because of offshoring can apply for trade-adjustment assistance (TAA). To access the assistance, employees must request it from the Labor Department. The fillings, however, are usually drafted by state governments which must say how many workers lost their jobs and why. The department must approve the petitions before providing the federal aid.
According to the petitions, about 450 IBM employees had to look for work someplace else because their company shipped their jobs elsewhere between 2015 and 2016. Experts, on the other hand, estimate that the number is higher. The fillings usually fail to tell the exact number of displaced workers or companies hide the information. One petition filed by workers from an IBM plant in Connecticut stated clearly that the company refused to release the info.
IBM’s destinations of choice are low-income countries were labor is cheap such as India, China, Brazil, Egypt, Bulgaria and Costa Rica. In some cases, the company reportedly forced workers to train their foreign peers or risk losing severance pay.
IBM, Intel, Verizon at the Top of the List
A former IBM manager wrote in a petition that he and his colleagues at the Global Technology Services had to lay off their teams and then were laid off too.
My staff was, at its peak, a couple hundred people,
the former manager wrote.
Nevertheless, the company decided to move production to India. IBM has yet to reply to a request for comment. Trump, however, could get some answers from the company’s CEO since Rometty has joined the panel of experts designed to advise him on job growth and economy.
Experts noted the New York billionaire focuses on manufacturing job losses, which draw a lot of attention when a factory closes. Companies such as IBM that move technical jobs overseas tend to fly under the radar because they move them in smaller chunks. However, over time, the numbers add up.
Another company that heavily shipped U.S. jobs abroad is Intel Corp. with 1,600 jobs vanishing because of offshoring between 2015 and 2016. Over the same period, Verizon lost 470 jobs to offshoring operations to Philippines. Both companies refused to comment on the measures.
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