Siemens to cut 2,000 IT jobs in Germany

4th August 2010, Comments 0 comments

German industrial giant Siemens said Wednesday it would cut 2,000 jobs in its German IT solutions and services (SIS) unit, part of a broader cost-cutting programme initially unveiled in March.

The company and worker representatives have reached agreement on how to implement the decision "in a socially responsible manner," a statement said.

Offers would be made "for the voluntary termination of employment, ranging from partial early retirement to employment termination agreements," it added.

The group also planned to propose to reassign some workers internally and offer training for others.

At the end of its fiscal year to September 2009, "the IT business had about 35,000 employees worldwide, of whom slightly less than 10,000 were in Germany," the statement said.

The decision is part of a broad restructuring of the SIS division announced on March 18 that included the cutting of 4,200 jobs worldwide.

Siemens said at that time it would restructure the unit around two poles of activity -- business information technology solutions and IT outsourcing.

SIS sales have fallen for several years and analysts say its technical staff are better paid than at rivals such as IBM, Hewlett Packard and Accenture.

Siemens said "the adjustment measures became necessary after revenue in SIS's personnel-intensive business declined to 4.7 billion euros (6.2 billion dollars) in the fiscal year 2009," an annual decrease of more than 12 percent.

"In the third quarter (to June) of the current fiscal year 2010 alone, SIS reported a loss of 81 million euros on revenue of 1.1 billion euros," the firm said.

Siemens has already spent around 500 million euros to restructure other divisions and has slashed 23,000 jobs as part of its cost-cutting programme. At the end of last year, its workforce totalled 405,000 worldwide.

The group's vast operations extend from the manufacture of light bulbs and washing machines to medical imaging equipment, wind turbines, nuclear reactors and high-speed trains.

On June 30, Siemens said it had resumed full-time work schedules at German sites owing to a pick-up in demand however.

A day earlier it reported that quarterly sales for the entire group climbed by four percent to 19.2 billion euros and that new orders had jumped by 22 percent to 20.9 billion euros, their first increase since the last quarter of 2008.

Siemens shares showed a loss of 1.39 percent to 76.71 euros in late Frankfurt trading, while the DAX index of leading stocks was 0.36 percent higher overall.

© 2010 AFP

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