IBM should be fined for reneging on their agreement.
Iowa Spent $50 Million to Lure IBM. Then the Firings Started
Five years after bringing high-tech jobs to the Midwestern states of Iowa and Missouri, International Business Machines Corp. has fired half its workers there -- sowing ire and disappointment for locals and officials alike.
In April, Iowa Senator Chuck Grassley wrote IBM to condemn the firing of about 700 employees in Dubuque, Iowa. The same month, Missouri suspended tax credits after IBM’s headcount in the city of Columbia fell below the required minimum of 500.
When IBM came to Dubuque in 2009 and then to Columbia, it needed workers to help companies run their technology. Three years later a new CEO decided to automate some of the business, and the firings began. It’s a blow to Dubuque and Columbia, cities that spent a combined $84 million on tax breaks and other incentives to lure Big Blue in the hopes of attracting other technology firms and incubating a startup scene.
Iowa Republican Senator Chuck Grassley.
Photographer: Tom Williams/CQ Roll Call via Getty Images
It’s a story that has played out often across America: Big company comes to town, provides boost to the local economy and then leaves. In the 20th Century this narrative took decades to unfold, as companies making things like steel and furniture gradually found themselves unable to compete. Now, the process can happen in a matter of years, especially if the employer is a tech company battling disruptive upstarts or rebooting strategy on the fly.
IBM declined to comment on the employment levels in Dubuque and Columbia, future plans for the locations or on the treatment of its workers there. “IBM is constantly investing in skills to meet the demands of our clients, especially in areas such as Cloud, Analytics, Mobile, Social and Security,” Adam Pratt, a spokesman for IBM, wrote in an e-mailed statement.
Rick Dickinson, a Dubuque official who helps lure new employers, said he’d expected IBM to put the city on the map and help Iowa transcend Midwestern stereotypes he describes as: “red barn, silo, Holstein cow, hog and a bale of hay.” No company before IBM has moved into town or ramped up so quickly - - only to scale back, he said.
more:
http://www.bloomberg.com/news/articles/2015-05-19/iowa-spent-50-million-to-lure-ibm-then-the-firings-started
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