NEWS (REASON FOR DROP)Jobs cut at CGI, LGS
Updated: Tue, Mar 07 02:03 AM EST
MONTREAL (CP) - Between 250 and 300 programmers and computer consultants have
been laid off at CGI Group Inc. - while about 200 Y2K specialists have also been
given the chop at LGS Group Inc., the rival Montreal-based consulting companies
said separately Monday.
At CGI, the dumped employees "don't have the type of skill sets our clients are
looking for in given projects," said Ronald White, CGI's director (investor and media
relations).
"More or less the same number of people have been hired" as laid off in recent
months, he added, leaving the payroll steady at about 10,000.
The new individuals have been hired for specific skills, he added, particularly the
"very hot" electronic-commerce sector.
"We're very much in hiring mode," White said, with about 200 job openings currently
listed on CGI's Web site.
The story is different at LGS, which unlike CGI has been losing money and is about to
be swallowed by IBM Corp. for $275.5 million.
The 200 who have lost their jobs at LGS aren't being replaced, reducing the work
force by almost 10 per cent.
The end of year-2000 work - a basket into which LGS put proportionately more eggs
than rival CGI - triggered a decision last fall to chop the LGS professional staff from
"around 2,200 to around 2,000," said Francine Osborne, LGS vice-president
(communications).
Their "skills no longer corresponded to our market's needs," said Osborne, attributing
the cutback to "the slowdown of Y2K."
"As things pick up in the market, we will obviously increase our work force
accordingly," she added.
IBM expects to buy out LGS through a $19-a-share deal announced Feb. 15.
The takeover was announced only hours after LGS disclosed it ran out of gas during
the third quarter ended Dec. 31, posting a loss of $1.6 million, or 13 cents a share.
That was a sharp reversal from year-earlier profit of $2.4 million, or 19 cents.
Quarterly sales dropped to $57 million from $59.5 million.
At CGI, White said, "the number (of layoffs) is greater in Toronto than it is in
Montreal."
However, "I don't have the exact numbers" or even
approximations, he said, adding that "CGI is a decentralized organization." The
company now has about 3,000 people on its payroll in each city.
"Substantially less than half" of those terminated had been specializing in year-2000
work, White said, an area he said "never represented more than five per cent of our
revenue base."
CGI is effectively controlled by BCE Inc. of Montreal.
He said one to three per cent of the work force is let go each year after the
company's clients have told CGI what information-technology services they'll need
for the coming year. |
