(Host) Commentator Tim McQuiston wonders if IBM is going the way of the dinosaurs.
(McQuiston) It must have been 1996, but I could be wrong on that. I was driving home very late after a very long day of work when I decided, for no reason really, to take the back route. The back route took me up Kimball Avenue in South Burlington past what is now called Technology
What I encountered was something like the end of the age of dinosaurs. Here in the middle of the night was a herd of tractor trailers, headlights staring into the dark, standing around or slowly moving in and out, with big blue lettering on the side which read “Digital.”
Digital Equipment Corporation is a dinosaur. It was big and now it’s dead. It was the second largest computer company in the world at one time. In 1998 what was left of Digital was bought by Compaq for an astounding $9.6 billion, the largest deal of its kind. At its height in
Vermont, Digital employed about a thousand well-paid people.
With other giant sauropods like Data General and Wang Laboratories, Digital thrived in the era of the Massachusetts Miracle. Digital, or DEC to those in the know, was a wonderful place to work and its employees called themselves Deckies, although I’m not sure how you’d spell that.
And now we have IBM laying off another 500 Vermonters. The massive Essex Junction/Williston plant has trimmed its workforce by more than 2,000 in two years. We’re down to about 6,300. Now, that’s nothing to sniff at. State government employs about the same.
But it’s the downward trend that has everyone worried that IBM will abandon the plant entirely at some point. Rumors have it that this is just the first wave of layoffs, and that Vermont isn’t even in IBM’s five-year plan.
The worldwide semi-conductor industry is in very bad shape, certainly, so IBM needed to respond to a situation that will not get any better in the near future. The problem is that IBM has a sparkling new plant in New York with much more than enough capacity for its current needs, even without Vermont. On top of that, US firms are not only outsourcing their manufacturing, they’re starting to ship technical and engineering jobs overseas. What’s going to be left?
Perhaps IBM is trying to let us down easy, like an aging boyfriend without prospects. Or maybe it wants to sell the Vermont plant to the highest bidder. We can hope that the entire industry will turn around and that IBM will be able to fully implement its plan to dominate the semi-conductor industry with its new foundry concept of designing and manufacturing chips for a vast range of other high-tech firms.
And maybe, just maybe, the huge Essex Junction plant will rise to prominence and proudly walk the earth again.
This is Timothy McQuiston.
Timothy McQuiston is editor of Vermont Business magazine.