Citing costs, IBM to move 110,000 retirees off health plan

International Business Machines Corp. plans to move about 110,000 retirees off its company-sponsored health plan and instead give them a payment to buy coverage on a health-insurance exchange, in a sign that even big, well-capitalized employers aren't likely to keep providing the once-common benefits as medical costs continue to rise.

The move, which will affect all IBM retirees once they become eligible for Medicare, will relieve the technology company of the responsibility of managing retirement health-care benefits. IBM said the growing cost of care makes its current plan unsustainable without big premium increases.

IBM's shift is an indication that health-insurance marketplaces, similar to the public exchanges proposed under President Barack Obama's health-care overhaul, will play a bigger role as companies move coverage down the path taken by many pensions, paying employees and retirees a fixed sum to manage their own care. Read more >>

Tech layoffs more than doubled in 2nd quarter

Layoffs announced by U.S. employees in the technology sector more than doubled in the second quarter, reaching the highest level in a year, according to new data from consulting firm Challenger Gray & Christmas Inc.

During the period, the computer, electronics and telecommunications industries announced plans to cut a combined 20,491 positions, up from 8,392 during the first quarter, but down from 39,164 a year earlier.

The second quarter included layoff plans from tech giant International Business Machines Corp. IBM -0.08%  , which is expected to cut as many as 8,000 workers after the company posted disappointing first-quarter earnings, according to Challenger.

Computer firms reported the highest number of planned job cuts--at 16,404--up sharply from 3,526 during the first quarter. Cuts by electronics firms surged 68% to 2,344 from the previous quarter. However, planned telecom cuts were down by half at 1,743. Read more >>