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State Farm IT outsourcing will lead to 451 layoffs; many will be offered jobs at HCLTech


State Farm will be laying off 451 employees in Bloomington next month, part of the insurer's IT outsourcing plan, the company told state officials. Many of the employees will be offered jobs at the company taking over that IT work, called HCLTech.

The Bloomington-based insurer's plans were disclosed in the monthly Worker Adjustment and Retraining Notification (WARN) report released Wednesday by the Illinois Department of Commerce and Economic Opportunity. It's the first time specific numbers have been publicly released related to State Farm's job cuts. Under state law, large employers must notify the state when they plan to lay off workers.

The 451 people will be laid off March 31, State Farm told DCEO officials. That's about 3.5% of the company's 13,000-employee McLean County workforce. State Farm is Bloomington-Normal's largest employer.

In mid-January State Farm announced plans to outsource some of its IT operations to the Indian IT services company HCLTech, hoping to meet evolving needs at a volatile time for the insurance industry. HCLTech will assume the day-to-day IT Help Desk and infrastructure services work. HCLTech will manage hardware, infrastructure software, and network connections support for State Farm.

When it announced the cost-cutting move, State Farm would not disclose how many people would be impacted. It said in January that "many employees” would be offered jobs at HCLTech in similar roles supporting State Farm. "A small number of employees will no longer be associated with State Farm," a spokesperson said then.

When asked Wednesday how many of the 451 people will be offered jobs at HCLTech, a State Farm spokesperson said: "Many of these employees have been offered opportunities to join HCLTech in similar roles with similar work arrangements in their current locations supporting State Farm."

Ryan Denham is the digital content director for WGLT.