
How IBM quietly pushed out 20,000 older workers [video] - daviddavis
https://www.youtube.com/watch?v=e681QNbHloE
======
justboxing
IBM has stopped innovating a long time ago, I would guess sometime in the late
1980s

IBM is also the biggest Patent Troll on the planet[1]. I met a Patent and IP
Lawyer at a Code Camp in San Luis Obispo. He said he did Legal Patent and
Licensing work for IBM for many years and claimed that they generated over 1
Billion $ / year just from their Licensing deals and patent enforcement alone,
and that it was their biggest source of income. I tried to see if those # in
his claim were true, and it looks like they are, even to this day.

> Between 2008 and 2012 IBM’s patent portfolio generated between $1.1 and $1.2
> billion per year.

Source: [https://www.forbes.com/sites/chuckjones/2016/01/19/if-
patent...](https://www.forbes.com/sites/chuckjones/2016/01/19/if-patents-are-
so-valuable-why-does-ibms-intellectual-property-revenue-continue-to-decline/)

[1] Source:
[https://thumbor.forbes.com/thumbor/960x0/https%3A%2F%2Fblogs...](https://thumbor.forbes.com/thumbor/960x0/https%3A%2F%2Fblogs-
images.forbes.com%2Fchuckjones%2Ffiles%2F2016%2F01%2F2015-Patents-IBM-vs-
Competitors.jpg)

~~~
candiodari
And yet I'd bet a lot of money that innovating again was a large part of the
reason IBM management justified to itself and shareholders these layoffs.

Turns out, again, that management had zero plans for innovation. Instead, they
only had the standard MBA plans : we're going to get a cheaper, MUCH worse,
workforce. No more decisions to make for management, so they don't have to
take the risk of being wrong anymore.

Innovation ... died. Bill Gates became the richest man in the world taking one
of their more obvious opportunities. But managers looked good to other
managers, you know, in ways they were taught in their MBA education, and only
in those ways. IBM ... withered and died, in the opinion of a lot of people.
IBM watson, their poster child for innovation, is not even a bad joke in the
AI research community. It's actually unknown. It's an empty shell.

Today, even the financial community is saying stuff like IBM is like McDonalds
... it's a real estate play (you're essentially betting on their ability to
sell-and-lease-back their real-estate portfolio and pay out the short term
profits from that to their shareholders). There is much justification for that
in their financial reports.

It's a bit wider than that: they own some things, and they're rent-seekers,
who are to deep in debt and are finding they have to sell ever more income-
generating assets. Every product they have, even the ones with deep market
lock-in is declining fast.

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paulcole
For anyone who doesn't want to watch a youtube video, here's the article the
video is based on:

[https://features.propublica.org/ibm/ibm-age-
discrimination-a...](https://features.propublica.org/ibm/ibm-age-
discrimination-american-workers/)

~~~
rb808
& the discussion
[https://news.ycombinator.com/item?id=16648000](https://news.ycombinator.com/item?id=16648000)
which has 348 comments.

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givinguflac
My uncle used to work for IBM, and he told stories for years before also
getting let go. They definitely made a push for a younger workforce.

------
ranchdubois
On my first day at my new job out of college, IBM told me the location I
requested for in my offer letter could only be temporary as I was on "loan" in
a budgetary sense. Now 6 months in, I must transition to a new role (which
will not be in my current location). I have other offers in this area, but the
agreement I had to sign to repay my bonus (which has been used to pay off
student loans) if I voluntarily leave before a year of service is likely not
something myself or a startup can make happen at this point. I feel trapped
and it's not great.

~~~
bm1362
Anecdotally, I’ve had 2 friends leave companies where they owed a bonus to the
company (50k) - one paid it back and one didn’t. The one who didn’t, never
heard from them and it’s been over 2 years now.

Not advocating this, but don’t be miserable over a small sum of money. They’ll
probably work with you on a repayment plan if necessary.

------
fatjokes
Did IBM use to have "great wages" as the article says? Because it certainly
doesn't anymore. A friend had an offer from IBM Research. It was practically a
grad student stipend and a drop in the bucket compared to GoogFace wages. It
was even worse than Amazon wages, which is already a painfully low bar.
(Though AFAIK at least they let you pee in the bathrooms).

~~~
RickS
Anecdotally, yes. My grandfather worked at IBM, retired comfortably, had many
hobbies, and notoriously packed the christmas tree every year. I was shocked
to find, only this year, that despite a basement full of oscilloscopes and
tape equipment, his role had been... customer support? Maybe this was less
"call center" and more "embedded engineer". I'll never know.

How much of this effect was IBM, how much was the economics of America at the
time, and how much was specific to this one man is debatable. But he
definitely appeared to live well, whatever it was.

~~~
IshKebab
Customer support engineers can be a really skilled job - you have to get
highly skilled engineers who know the product well and can explain it and
answer technical questions, but that also have really good social skills and
are good at sales. A pretty rare combo in my experience.

Maybe that's not what he did but I wouldn't write of "customer support" so
easily - it could mean a wide range of things.

------
dawnerd
Would a penalty/fee/tax help prevent companies from laying off then
immediately hiring for the same role? I’m sure they’d just find a loophole but
there’s got to be a way to at least reduce the benefit to the companies.

~~~
samfisher83
Then they might just not be hired back. Which would be even worse.

------
Dowwie
IBM is one of the few remaining employers who will pay for your outrageous
graduate School tuition, provided you work for them another five years
following your completion.

------
jbob2000
Ageism was just a side effect, I don't think IBM committed it intentionally.
IBM's business changed and some of their employees failed to change with it.
That the employees who failed to change were generally older is just a
coincidence.

I know that I might face that same reckoning when I get older - out of date
skills pushing me out of the market - so I'm actively taking steps now to set
up habits that keep me on top.

~~~
jasonlotito
So, as others mentioned, you should read the article. For example, here is
something that addresses your exact comment:

> Told some older employees being laid off that their skills were out of date,
> but then brought them back as contract workers, often for the same work at
> lower pay and fewer benefits.

~~~
djrogers
That doesn’t prove ageism, it proves that IBM (and apparently the market)
thought those specific individuals were overpaid for their skill sets.

Sounds like kind of a crappy move, but it doesn’t prove ageism.

~~~
dsr_
Is there a difference between losing your job because of ageism and losing
your job because the company thinks they can get the job done for less money?

Is it still a difference when the functional effect is that workers over 45
are the primary target?

