HP to shed 9,000 jobs in automation push

The company will eliminate 9,000 positions, automate its datacentres and invest in private cloud and desktop-as-a-service

HP has announced it will cut 9,000 IT services jobs over a number of years while investing in fully-automated datacentres.

The company said on Tuesday that the cuts were part of its continuing consolidation of EDS, now called HP Enterprise Services. The company will spend $1bn (£681m) on automated datacentres built on its converged infrastructure, it said.

"Over the past 20 months, we focused on integrating EDS and improving profitability," said Tom Iannotti, senior vice president and general manager of HP Enterprise Services, in a statement. "Now that the integration is largely complete, we have identified significant opportunities to grow and scale the business."

In a webcast on Tuesday, HP executive vice president Ann Livermore said the company would focus on consolidating its Enterprise Services datacentres, management platforms, networks, tools and applications, to create a more automated infrastructure.

"As a result of productivity gains from automation, in addition to streamlining the organisation, HP expects to eliminate roughly 9,000 positions over a multi-year period," said Livermore. "The combination of these activities will allow HP to reinvest for future growth."

Livermore said HP will create 6,000 jobs in sales and global delivery centres. The net loss of jobs will be 3,000.

HP will invest in private cloud infrastructure, application services, and desktop-as-a-service, Livermore added. The investment will cost $1bn over a number of years, HP said, but the company expects to see savings of $1bn gross per year, with net savings between $500m and $700m.

HP has faced industrial action in the past over job cuts and pay disputes following the EDS consolidation, including from members of the Public and Commercial Services Union (PCS).

Jim Hansen, one of PCS's national officers, told ZDNet UK on Wednesday that the union was "extremely disappointed" not to have been contacted by HP about the proposed cuts.

"The UK has suffered disproportionately in [HP] job cuts over the past two years," said Hansen. "Further job cuts would be not-at-all welcome."

HP told ZDNet UK on Wednesday that it had not yet decided where the jobs would be cut from its workforce. "HP is not be providing geographical locations of the job cuts at this time as final decisions have not been made," said an HP spokesperson.


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