SAP to add nearly 400 jobs at Pa. offices - Update

File photo: SAP CEO Bill McDermott at his Newtown Square office. The company is adding a Pittsburgh outpost, with state aid

Business-software maker SAP SE is adding nearly 400 jobs in Pittsburgh and suburban Philadelphia, state officials said today. The German company plans:

- 150 new jobs at its U.S. headquarters in Newtown Square, Delaware County, where SAP already employs 2,937, including SAP chief executive Bill McDermott, leaders of his sales organization and a data center;

 -  A new $72 million facility, to employ 242 staff, on the north side of Pittsburgh.

While SAP has its U.S. (formerly Western Hemisphere) headquarters in suburban Philadelphia since the 1980s, employment here has been steady at around 3,000 since the late 2000s, even as the company expanded offices in New York, Washington and other U.S. cities.

UPDATE 1/11: SAP employs around 400 in software development in Newtown Square, says company spokesman Steve Collins. "The largest units in NSQ are engaged in custom development, cloud delivery services and managed cloud delivery, and we also have units who work on global product security, knowledge management and product portfolio management."  

SAP's larger software development centers include Silicon Valley, Calif., where the company employs 1,600 developers at offices in Palo Alto, Dublin, South San Francisco and San Francisco;  and centers in German and India. In all, SAP employs 18,000 in the U.S., 82,000 worldwide.

At Newtown Square, SAP staff includes "sales, marketing, administrative, customer support, (software) development and other job functions," says spokesman Steve Collins. 

Pittsburgh, the shrunken former steel capital, has lately attracted energy, robotics and transportation software investments. Uber, the car ride service that depends on massive venture capital investment, last year hired 40 Carnegie Mellon technicians and researchers away from that university to staff its Pittsburgh driverless-vehicle project. 

“We are excited to continue to expand in Pennsylvania," said Jennifer Morgan, president, SAP North America, in a statement. She and other company officials didn't address what the new workers will be doing.

Pennsylvania agreed to pay SAP $1.78 million -- $600,000 in a Pennsylvania First program grant, $1.176 million in Job Creation Tax Credits -- if the company expands as promised.   

Morgan called the state's relationship with SAP "a model for how the public sector and the business community can work together.”  

 SAP earned profits of $4.5 billion on sales of $22 billion last year, according to analysts' estimates complied by Bloomberg LP.

 Pennsylvania's cash-strapped government in Harrisburg has been laying off staff and facing budget cuts as credit analysts threaten to cut its bond rating, already the among the lowest for U.S. states. With lower bond ratings, a borrower has to pay more to raise cash, boosting taxpayer costs.

But the state feels obliged to continue giving relatively small amounts of cash to encourage employers like SAP, who are actively courted by rival states.

The SAP grants are administered by Gov. Tom Wolf's Department of Community and Ecomonic Development, which funds "low-interest loans, tax credits, and grants" last year.

Companies told the state they either added, or agreed not to move out of state, a total of 245,000 jobs, thanks at least partly to the grants and loans. The state previously gave SAP cash to help it add a customer data center at the Newtown Square offices.