AI has created a lot of buzz around the last few years, and we now might’ve had the first official announcement by a major company on how it will impact jobs.
IBM says it could replace 7,800 jobs with AI in the coming years. The company is also pausing hiring for such roles, which are mainly in HR and other back-office functions. Hiring in back-office functions — such as human resources — will be suspended or slowed, IBM CEO Arvind Krishna said in an interview. These non-customer-facing roles amount to roughly 26,000 workers, Krishna said. “I could easily see 30% of that getting replaced by AI and automation over a five-year period,” he said.
More mundane tasks such as providing employment verification letters or moving employees between departments will likely be fully automated, Krishna said. Other HR functions, such as evaluating workforce composition and productivity, probably won’t be replaced over the next decade, he added.
This is the first major announcement about how AI will directly impact jobs at a major tech corporation. The last few months have seen AI, most prominently ChatGPT, demonstrate its skills in varied tasks including writing, coding, painting and even solving McKinsey case studies. These capabilities aren’t yet perfect, but are often significantly cheaper and faster than other alternatives, or hiring human workers.
And ChatGPT has already had an impact on other smaller businesses. Just last night, education services provider Chegg, which uses humans to help students with their lessons and assignments, reported that it was seeing slowing in demand because of ChatGPT. This caused the stock to plummet 38 percent after trade, with investors spooked about how AI could impact the company going forward.
This is a situation that might see itself be repeated very frequently over the next few quarters. AI programs such as ChatGPT and Bard have gradually become more mainstream, and companies are now waking up to their potential. These programs have demonstrated such capabilities over the last few months including writing articles, code, data analysis, and even creative aspects like drawing and painting that it’s hard to imagine any white-collar jobs that wouldn’t be benefited by their use. While using these programs might make employees more efficient, it can also, as IBM seems to have discovered, make many millions of employees redundant. It remains to been how widespread the disruption caused by AI will be, but within months of ChatGPT’s launch, it’s already creating ripples at some of the biggest companies in the world.