IBM freezes salaries of executives, many workers

Only employees with high-demand skills will get raises; may be part of aggressive plan to meet goals of 2015 roadmap

IBM this year won't be awarding pay raises to its executives or to many of its workers in its Global Technology Services unit.

The company said it is only giving pay raises to workers with high-demand skills that the company needs.

IBM typically awards raises during the mid-year period.

"There are targeted skill groups of employees that are eligible for salary increases in 2012," said Trink Guarino, an IBM spokeswoman. "No executives will be eligible for salary increases."

Business Insider Tuesday published an internal IBM memo announcing the action that was sent to employees from Global Technology Services executives.

One IBM employee, who didn't want to be identified, said he believes the lack of pay raises "is part of IBM's hyper-aggressive plan to meet its 2015 roadmap."

That IBM roadmap lays out an aggressive growth strategy, which calls for increasing the company's earnings per share by $20 by 2015.

The employee noted that the company has been spending billions in stock buybacks, but says it can't afford pay increases.

Rather than reaching profit goals "the old-fashioned way by increasing market share, developing and selling new products," the company is "maniacally focused on cutting labor costs and off-shoring work to low-cost countries," the employee said.

IBM's roadmap also calls for a major expansion of its cloud businesses, increasing the revenue from growth markets from about $21% to 30%, and for an expansion of its Smarter Planet initiatives.

The company has been steadily cutting its U.S. workforce through layoffs and early retirements in recent months while its worldwide employment numbers increase.

Patrick Thibodeau covers SaaS and enterprise applications, outsourcing, government IT policies, data centers and IT workforce issues for Computerworld. Follow Patrick on Twitter at @DCgov, or subscribe to Patrick's RSS feed . His e-mail address is pthibodeau@computerworld.com.

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