IBM announced that he wanted to give up his entire research and development department (R&D) in China. The American tech giant therefore extends the list of large US companies that have decided to take a step back from development projects in China. The decision will affect more than 1.000 employees, while the company says it will move to other bases abroad.
This was reported by Jiemian News, a digital media based in Shanghai, citing what was announced by Jack Hergenrother, vice president of IBM Global Enterprise Systems Development, at the meeting of all IBM China System Center staff. The measure concerns the reduction of personnel in the activities between Beijing, Shanghai, Dalian and other locations where access to the company's research and testing systems was recently revoked.
IBM China has approximately 12.000 employees
The US giant in China has around 12.000 employees on its payroll. Assuring that the changes will not affect IBM's ability to provide support to customers in Greater China, Jiemian News explained that "Chinese enterprises, particularly private ones, are increasingly focusing on seizing the opportunities offered by hybrid cloud and of artificial intelligence, and IBM's local strategic goal in China is to leverage our extensive experience in technology and consulting to form a team with the corresponding capabilities to help Chinese customers create solutions that meet their needs."
Artificial intelligence takes the place of people
Big Blue has already conducted several rounds of layoffs around the world, including the one in January 2023 with the announcement of 3.900 redundancies. For the second half of the year, it announced a hiring freeze and planned to replace nearly 8.000 jobs with artificial intelligence. Last March, according to media reports, IBM's staff reduction target in some departments was 80%.
IBM is not alone in leaving China
IBM is not an isolated case: Bloomberg recalls that the economic recession of the Dragon, the increase in regulatory pressure from the authorities and also the difficult coexistence of foreign technology with Asian technology weigh on strategic choices. Big names on Wall Street, like Morgan Stanley, recalls the financial agency, they have moved some operations abroad, while foreign investments have slowed down partly due to Beijing's fears of favoring local operators. In the technological field, for example, he pushes Huawei in an attempt to ensure a prosperous future despite the limitations of access to US-made technologies.
