IBM to add 600 jobs in RTP

The workers, to be hired over 2 years, will help mortgage lenders cut costs.

Staff WriterJuly 9, 2010 

  • Workers: About 10,000

    What they do: Business units with operations in RTP include IBM Global Services (provides a range of tech support and services to large corporations and other customers), software development, university recruiting and marketing

    Size of campus: About 800 acres

    History: The New York-based tech giant was one of RTP's first tenants, opening its campus in 1965.

  • March: Hewitt Associates, a human resources consulting firm, announces it will expand its operations in Charlotte and add 463 jobs over the next three years.

    Cincinnati-based Pierre Foods says it will add 500 jobs over the next three years as it expands its Claremont plant in Catawba County.

    February: Medical-testing company LabCorp plans to add 346 jobs in Greensboro as it consolidates billing operations from across the country.

    December: Risk management firm IEM says it plans to move its headquarters to RTP from Baton Rouge, La., and create 430 local jobs over the next six years.

    Investment banking giant Credit Suisse says it plans to hire about 300 more workers in RTP in 2010.

    Swedish appliance maker Electrolux says it will move its North American headquarters to Charlotte, bringing 738 jobs.

    November: Talecris Biotherapeutics says it plans to add 259 jobs over the next seven years as part of a $268.7 million expansion of its Clayton drug-manufacturing plant.

    October: LED lighting company Cree announces it will add 575 workers in Durham by the end of 2012.

    September: EMC Corp., a maker of data-storage computers, announces that it plans to expand its Triangle operations to add nearly 400 jobs.

IBM revealed plans to add 600 jobs at its Research Triangle Park campus, the latest in a series of announcements that underline the region's relative strength as the national economy struggles to recover.

The technology company, which still employs about 10,000 people in RTP despite layoffs in recent years, will open a center to provide services to mortgage lenders and help them reduce costs. It's one of the largest jobsannouncements in the state in recent years.

Gov. Bev Perdue got to break the news Thursday because the state promised IBM as much as $7.79 million in incentives if the company meets its hiring goals and keeps the jobs over the next 10 years. Critics question why large, successfulcorporations should receive such perks.

"It's corporate greed and political irresponsibility," said Bob Orr, the executive director of the N.C. Institute for Constitutional Law in Raleigh and an outspoken opponent of economic incentives. "IBM doesn't need the money. It doesn't need the money more than our education system needs it."

Also, the jobs that economic developers covet most are those that pay above-average wages, and, by strict definition, IBM's new jobs don't fit the bill. IBM will pay its workers an average of $50,000 a year, less than the Durham County average of $57,772, according to the governor'soffice.

Commerce Department spokeswoman Deborah Barnes said that the average wage in Durham is "artificially high" - the highest in the state - thanks to the concentration of Ph.D.s who work in Research Triangle Park, which is mostly in Durham.

"I'm sure there will be plenty of people willing to work for $50,000," she said.

Hiring will begin immediately for the center, which will be in one of IBM's current buildings. IBM expects to add the jobs over the next two years.

"We're expanding our capabilities for existing and potential clients," said company spokesman Bruce McConnel.

Big picture on jobs

The new jobs are a welcome addition at a time when few employers are expanding and others continue to cut back. The state's jobless rate remains above 10 percent, higher than the national average.

The Triangle, however, continues to fare better. Its unemployment rate fell to 7.8 percent in May.

Part of this region's health comes from tech companies that are ramping up hiring as spending on software and other products revives. Data storage companies EMC and NetApp, LED lighting company Cree and networking giant Cisco Systems are among those that recently have announced plans to add hundreds of local workers.

"The rumors of our demise are premature," said Rick L. Weddle, CEO of the Research Triangle Foundation, which manages RTP. "There are a lot of companies in the park that are continuing to do quite well."

IBM's expansion plans come against a backdrop of an intermittent stream of layoffs in recent years at the comp any, which typically doesn't disclose specifics and sometimes doesn't even confirm that job cuts occurred. Ex-IBMers and a union that is trying to organize the company's workers have said IBM is shifting U.S. jobs overseas, where labor costs are cheaper.

Cloud computing in RTP

Still, there have been other signs IBM remains committed to its RTP campus, one of its largest sites in the world. In November, IBM began operating a new $362 million cloud computing center in RTP that runs data center operations for clients such as the U.S. Golf Association. That facility functions with just a handful of employees.

"The new services operation furthers our commitment to the state of North Carolina and our ongoing presence in Research Triangle Park," Bob Greenberg, IBM's senior executive for North Carolina, said in a prepared statement.

IBM earned a profit of $13.4 billion on revenue of $95.8 billion last year. State officials promised the company millions in incentives to prevent it from expanding elsewhere, Commerce's Barnes said.

IBM also looked at Atlanta and Dallas as potential sites for its center, she said.

Orr, who has filed lawsuits to block other incentives packages, questioned whether the state money really made a difference for IBM.

"I suspect they made a business decision to expand and made the decision that RTP is the best place to do that," he said. "The money is just the cherry on top of the ice cream."

Staff writers Alan M. Wolf and Brooke Cain contributed to this report.

david.ranii@newsobserver.com or 919-829-4877

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