JANUARY 15, 2009, 12:00 A.M. ET IBM Plans New Center in Iowa
By WILLIAM M. BULKELEY Wall Street Journal http://online.wsj.com/article/SB123199085551484767.html International Business Machines Corp. said it plans to open a new remote computer-services center in Dubuque, Iowa, that will employ up to 1,300 people by the end of 2010. IBM, which has been criticized in the past for moving jobs to India and other offshore locations, said the Dubuque site would be its biggest new U.S. facility in 10 years. The company, which employed 386,558 people world-wide at the end of 2007, wouldn't say whether the new jobs represent any net U.S. gain. The terms of the deal underscore how coveted new jobs are among the states at a time of rising unemployment. Iowa is paying up generously to attract the plant. Mike Blouin, president of Greater Dubuque Development Corp., said it is providing "a $55 million package." That includes an $11.7 million loan from the state that will be forgiven if IBM maintains the jobs for two years. Local community colleges will pay IBM $10 million for job training expenses for its employees. Under an Iowa program that he called unique, Mr. Blouin said the colleges sell bonds to finance the training expenses, and pay off the debt from the state income taxes generated by the trained IBM employees. In addition, the government will guarantee a $25 million loan to a local nonprofit group that will renovate the building, and lease it to IBM at what Mr. Blouin said was a "very low" rate. IBM will also receive tax credits and a 20-year tax abatement. In return, Mr. Blouin said IBM will create a $58 million a year payroll plus benefits and add to local spending. IBM said the new center is designed to add to its world-wide network of support centers. It said it will move managers from other sites but it plans to hire most employees in the Dubuque area, with jobs starting in June. The new center, located in downtown Dubuque in an old department store, will be a sort of help desk for chief information officers and database administrators who need advice on fixing or updating their big server systems. Mike Daniels, IBM's senior vice president, said the new center will mostly serve U.S. clients that have outsourced computer-room management to IBM. "Not every client is comfortable with moving work offshore," he added. IBM has other service centers in Boulder, Colo.; St. Louis, Mo.; Raleigh, N.C.; and Rochester and Fishkill, N.Y. The company, which will report 2008 results Tuesday, has said that it expects 6% growth in its services business through 2010, with increased profitability. -- ================================ George Antunes, Political Science Dept University of Houston; Houston, TX 77204 Voice: 713-743-3923 Fax: 713-743-3927 Mail: antunes at uh dot edu *********************************** * POST TO [email protected] * *********************************** Medianews mailing list [email protected] http://lists.etskywarn.net/mailman/listinfo/medianews
