IBM Announces AI‑Driven Layoffs of 7,800 Positions, Projecting $2 Billion Annual Savings
During the Labor Day holiday IBM revealed it will pause hiring for roles it deems replaceable by AI, cutting about 7,800 jobs—primarily in HR and back‑office functions—and expects the move to save roughly $2 billion each year while other tech giants similarly scale back human‑focused positions.
IBM announced during the Labor Day holiday that it will temporarily halt hiring for positions it believes can be replaced by artificial intelligence, resulting in the permanent elimination of approximately 7,800 jobs, mainly in human resources and other back‑office functions.
The company estimates that automating these roles will save about $2 billion annually, contributing to broader cost‑management efforts.
IBM’s CEO Arvind Krishna noted that 30% of the 26,000 employees in these functions could be automated within five years, while software development and customer‑facing roles will continue to be hired.
Other tech giants such as Microsoft, Meta, Amazon, and Dropbox have also begun reducing or reallocating human‑resource positions in response to the generative AI wave, with some companies reporting significant stock declines after acknowledging AI impact on their core businesses.
Analysts from Goldman Sachs predict that up to 300 million jobs worldwide could be affected by AI technologies like ChatGPT, especially in office administration, legal work, and engineering, while higher‑educated, creative, and high‑income roles may face the greatest disruption.
Despite concerns, some commentators argue that AI will ultimately create new demand for talent, echoing historical patterns where technological advances both displace and generate employment opportunities.
Reference links: Business Insider , Ars Technica , IBM Q1 2023 Press Release .
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