Siemens adds jobs outside Germany
FRANKFURT, Germany (Reuters) -- German technology conglomerate Siemens said on Friday it planned to vastly increase the proportion of its software developers in lower-wage eastern European countries at the expense of growth in Germany.
The company confirmed a newspaper report quoting a member of Siemens' management board as saying it was realistic to expect
that a third of the firm's IT research and development business would be in low-wage countries in a few years' time.
Siemens has some 30,000 software developers, the overwhelming majority of whom are in Germany, which has Europe's second-highest labor costs. It now plans to expand into eastern countries that will join the European Union next year.
"We have to follow the trend, like all our competitors are doing, and relocate parts of our business,'' Johannes Feldmayer told the Financial Times.
"We are not at all happy with the conditions in Germany, when we compare them to those in countries with the strongest growth.''
A Siemens spokesman told Reuters this did not necessarily mean that jobs would be cut in Germany but only that new jobs would be created abroad.
"It's not about selling off German jobs or technology, it's about where we build up new capacities in the future,'' he said. "You must see this in the context that it's a long-term strategy.''
But the news made breakfast headlines in Germany, where a tenth of the workforce is unemployed after years of economic stagnation and all eyes are on a parliamentary battle to pass a bitter package of welfare cuts aimed at stimulating growth.
Siemens, Europe's biggest industrial employer, has more than 40 percent of its almost half a million staff in Germany -- a country which prides itself on the high standard of education of its graduates, particularly in disciplines such as engineering.
However, Feldmayer said Siemens was motivated not only by the potential for cost-cutting but also the high level of skills to be found among workers in lower-wage countries.
"We have found fantastic staff with excellent training, particularly software engineers,'' he said.
Siemens will be following in the footsteps of other technology giants such as Europe's biggest software firm SAP, which employs only around half of its software developers in its home country Germany.
SAP has for years had a policy of expanding in high-skill, low-wage countries and recently said it planned to double its 1,000-strong research and development workforce in Bangalore, India.
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