IBM freezes wages of IT consulting branch in the US

23 July 2012 1 min. read
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IT-company IBM will freeze almost all wages of its American Global Technology Services (GTS) department. Only a few groups of employees with particular skills will be eligible for an increase in salary. Both executives and staff are outraged by the announcement.

GTS is the IT consulting branch of IBM. Management consulting services are grouped in the Global Business Services (GBS) branch.

Majority no increase in salary

An American spokesman for IBM announced that the salaries of all executives, by definition, will be frozen. With an exception of the select group, the wages of a major part of the employees will, just as the wages of their executives, not rise. As a result, the majority of the American staff of IBM GTS will be worse off financially. It has not yet been disclosed whether the measure will also be implemented outside the United States.

IBM - Salary Freeze

Specific investments

Bob Zapfel and Richard Patterson, general managers of IBM GTS, informed the American staff of IBM GTS per memo about the lack of a general salary increase: “Instead, investments will be made in specific groups of employees or people in focus areas that are designated by the GTS lines of business, based on the needs in local markets. The decision does not affect the agreed salary development of talented people, including bonus programs, promotions and talent development.”


Employees of IBM have responded with disappointment and anger towards the plans in the media. An anonymous employee announced that IBM is following a “hyper aggressive plan” to achieve the objectives of its roadmap by 2015. To do this, billions are invested in the buyback of its own shares and as a result there is no money left for salary increases.