IBM pauses hiring for 7,800 jobs because they could be performed by AI

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MAY 2, 2023

IBM CEO Arvind Krishna said that artificial intelligence could fill some 7,800 jobs at the company. – Bloomberg via Getty Images

Big Blue is calling a big timeout on hiring real humans.

IBM CEO Arvind Krishna said the company will likely pause filling nearly 8,000 jobs because the positions could be performed by artificial intelligence within the next few years.

Krishna said that the company will either slow down or altogether suspend hiring for so-called “back office” functions such as human resources.

“I could easily see 30% of that getting replaced by AI and automation over a five-year period,” Krishna told Bloomberg News on Monday.

Jobs in which workers don’t have to face customers number some 26,000 employees at IBM, so 30% would amount to around 7,800.

Krishna told Bloomberg News that AI could perform functions such as moving employees between departments or writing employment verification letters.

The company plans to still hire for roles in software development as well as other customer-facing jobs, Krishna added.

The Westchester County-based multinational tech giant has a global workforce of 260,000 people.

In January, IBM announced it would be laying off 3,900 people after it missed its earnings targets.

At the time, IBM CFO James Kavanaugh told Reuters that the company was still “committed to hiring for client-facing research and development.”

Kavanaugh said that the company is expected to save $2 billion a year by the end of 2024 thanks to cost-cutting measures and efficiency steps, such as the selling off of its Kyndryl Inc. unit as well as part of the Watson Health business.

Despite the layoffs, Krishna said that IBM added a total of 7,000 people to its workforce in the first quarter.

IBM is the tech giant based in the Westchester County, NY town of Armonk.REUTERS

The rapid development of AI, which was most pronounced with the rollout of OpenAI’s ChatGPT bot, has already made an impact on businesses in the knowledge sector.

The parent company that owns Chegg, the California-based online learning site geared toward college students, saw its share price plummet after it admitted that ChatGPT was eating into its profits.

“Since March, we saw a significant spike in student interest in ChatGPT. We now believe it’s having an impact on our new customer growth rate,” said Chegg CEO Dan Rosensweig.

The company’s stock was down 47% at the start of trading on Wall Street on Tuesday.

The swift rise of AI has sparked concern from tech luminaries such as Elon Musk and others that it could upend civilization.

Musk on Monday cautioned that even a “benign dependency” on AI can threaten civilization.

The rapid development of AI has prompted concern among tech luminaries such as Elon Musk.SOPA Images/LightRocket via Getty Images

“Even benign dependency on AI/Automation is dangerous to civilization if taken so far that we eventually forget how the machines work,” Musk tweeted.

Dr. Geoffrey Hinton, a prominent AI researcher known as the “Godfather of AI,” told The New York Times that he has left his job at Google and that he regrets his role in developing the technology.

“I console myself with the normal excuse: If I hadn’t done it, somebody else would have,” Hinton said in an interview published on Monday.


Courtesy/Source: NY Post / NY Times