Oil giant sheds IT jobs to cut costs

San Francisco-based oil giant Chevron is axing 600 IT jobs as part of a cost-cutting and outsourcing programme.

The jobs will go from its network computing services operation. Chevron will farm out key in-house IT functions in a bid to cut costs by $50m (#30.3m) a year.

The first 100 jobs will be shed from Chevron Information Technology (CITC) on 1 April, with a further 500 scheduled for the chop during 1998. The division currently employs 1,600 people.

CITC also intends to lose a number of ancillary services, and will outsource most of its data processing to a third party.

All mainframe and telecoms operations will be outsourced by the start of 1998. Announcing the changes, Don Paul, Chevron's vice president of technology, said: 'CITC will manage the computing environment by using the most innovative methods available from both inside and outside the company.'

The IT division will be divided into two business operations. One will focus on providing customised software and networks for other Chevron business units, while the other will concentrate on shared services, including a global computing network.

The cutbacks are the latest development in a long-term strategy by the petroleum giant to rationalise its non-core business interests. That strategy has resulted in 16,000 jobs being eliminated across all its business units since 1990.