IBM to Cease Recruitment for Positions Automatable by AI Displacing 8,000 Employees

IBM to Cease Recruitment for Positions Automatable by AI Displacing 8,000 Employees

Recent advances in artificial intelligence (AI) are making people worry about their job security. The possibility of robots and algorithms taking over certain job functions has become more real, and according to a report by Goldman Sachs, the impact of AI on the labor market could be significant.

One month ago, Goldman Sachs predicted that AI could lead to around 300 million layoffs among highly paid, non-menial workers in the US and Europe. According to the report, using data on occupational tasks in both the US and Europe, around two-thirds of current jobs are exposed to some degree of AI automation. Generative AI could substitute up to one-fourth of current work, with up to two-thirds of occupations partially automated by AI.

While Goldman's forecast was met with emotions ranging from incredulity to outright mockery, it may not have been too far off the mark. Just last week, Dropbox announced that it would lay off 16% of the company, some 500 employees as the company sought to build out its AI division. In a memo to employees, Dropbox CEO Drew Houston said that “in an ideal world, we’d simply shift people from one team to another. And we’ve done that wherever possible. However, our next stage of growth requires a different mix of skill sets, particularly in AI and early-stage product development. We’ve been bringing in great talent in these areas over the last couple years, and we’ll need even more.”

The changes that Dropbox announced, while painful, were necessary for the company's future, according to Houston. “I’m determined to ensure that Dropbox is at the forefront of the AI era, just as we were at the forefront of the shift to mobile and the cloud. We’ll need all hands on deck as machine intelligence gives us the tools to reimagine our existing businesses and invent new ones.”

However, while Dropbox’s layoffs were lateral and meant to open up space for more AI-linked hires, in the case of IBM, it is AI itself that is making workers redundant. As Bloomberg reports, IBM CEO Arvind Krishna said the company expects to pause hiring for roles it thinks could be replaced with artificial intelligence in the coming years. As a result, hiring in back-office functions such as human resources will be suspended or slowed. These non-customer-facing roles amount to roughly 26,000 workers, according to Krishna. “I could easily see 30% of that getting replaced by AI and automation over a five-year period,” he said. That would mean roughly 7,800 jobs lost.

Part of any reduction would include not replacing roles vacated by attrition, an IBM spokesperson said. Krishna’s plan marks one of the largest workforce strategies announced in response to the rapidly advancing technology, and it certainly won’t be the last as virtually all companies follow in IBM’s footsteps and lay off tens if not hundreds of millions of workers in the coming years.

Mundane tasks such as providing employment verification letters or moving employees between departments will likely be fully automated, Krishna said. And while some HR functions, such as evaluating workforce composition and productivity, probably won’t be replaced over the next decade, it is only a matter of time before these roles are also replaced by AI.

IBM currently employs about 260,000 workers and continues to hire for software development and customer-facing roles. Finding talent is easier today than a year ago, Krishna said. The company announced job cuts earlier this year, which may amount to about 5,000 workers once completed. Still, Krishna said IBM has added to its workforce overall, bringing on about 7,000 people in the first quarter.

The coming years are poised to be a time of great change and uncertainty. With skyrocketing inflation and escalating political polarization, the stakes for the 2024 election are higher than ever. Moreover, the rapidly evolving landscape of artificial intelligence is transforming industries and threatening to replace many jobs in the near future. As we navigate these complex challenges, it is imperative that we stay informed and adapt to the shifting tides of our times.

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