IBM CEO Arvind Krishna has revealed plans to pause hiring for about 7,800 jobs that could be replaced by artificial intelligence systems over time, according to a Bloomberg news report Monday.
Krishna said hiring for back-office jobs such as human resources will be suspended or slowed, affecting nearly 26,000 non-customer jobs. This will include not replacing existing roles that have been vacated due to attrition. “I could easily see 30 percent of that being replaced by AI and automation over five years,” Krisha was quoted as saying in an interview by Bloomberg.
The announcement comes at a time when AI-powered chatbots such as ChatGPT have raised concern about the future of human jobs. In March, Goldman Sachs released a report estimating that generative AI could “subject” 300 million jobs to automation, meaning those roles could be reduced or replaced by AI systems.
At the same time, the shadowy specter of “artificial intelligence” is likely to become an easy scapegoat for layoffs and reorganizations, and its impact on jobs remains largely hypothetical. Dropbox, for example, announced last week that it would lay off about 500 employees in an effort to reorganize its workforce to ensure Dropbox is “at the forefront of the age of artificial intelligence.” But the current hype cycle around generative AI may not be particularly dissimilar to the historic shifts in the labor market brought about by increased automation.
Sorry or not, Krishna’s announcement at IBM is one of Big Tech’s strongest yet regarding the potential impacts on employment from AI. He anticipates that some tasks, such as providing job verification letters or moving employees between departments, will likely be fully automated. However, he also noted that some HR functions, such as assessment of workforce composition and productivity, are not expected to be replaced over the next decade.
Despite expected workforce reductions in select roles, IBM continued to hire for software development and customer-facing roles. Finding talent is easier now compared to last year, Krishna told Bloomberg, and the company added nearly 7,000 new employees in the first quarter. IBM currently employs about 260,000 workers.
IBM’s most recent quarter saw earnings beat estimates due to managing expenses, which included previously announced job cuts. CFO James Kavanaugh revealed plans for new productivity and efficiency measures, aiming to generate annual savings of $2 billion by the end of 2024.