State Farm plans to lay off 451 employees in Bloomington, Illinois, on March 31, 2023, as part of its IT outsourcing strategy, according to a notice filed with the Illinois Department of Commerce and Economic Opportunity (DCEO). This reduction represents approximately 3.5% of the company’s 13,000-employee workforce in McLean County.
In mid-January, the Bloomington-based insurer announced its decision to outsource certain IT operations to HCLTech, an Indian IT services firm, aiming to adapt to evolving industry demands. HCLTech will take over day-to-day IT Help Desk and infrastructure services, managing hardware, infrastructure software, and network connections for State Farm.
While State Farm did not initially disclose the number of employees affected, the recent WARN report provides specific figures. Under state law, large employers must inform the state when planning significant layoffs.
A State Farm spokesperson stated that many of the impacted employees have been offered opportunities to join HCLTech in similar roles, maintaining their current work arrangements and locations while continuing to support State Farm.
State Farm is Bloomington-Normal’s largest employer. The company’s collaboration with HCLTech reflects a strategic move to enhance efficiency and address the volatile nature of the insurance industry. By partnering with HCLTech, State Farm aims to leverage specialized expertise in IT services, potentially leading to cost savings and improved service delivery.
The transition to HCLTech is expected to streamline State Farm’s IT operations, allowing the company to focus more on its core insurance business.The long-term effects of this outsourcing initiative on the local economy and State Farm’s operations remain to be observed