Dropbox CEO Drew Houston called for “expansion” of AI products in a layoff memo to employees in April. Matt Winkelmeyer/Getty Images
Many companies across technology, media and finance have made significant job cuts this year.
At the same time, many companies are turning to investing more in AI, with some even citing AI as a reason for layoffs.
Here’s how some big companies are turning and cutting jobs as part of their AI push.
As the tough market conditions that began in 2022 continue, many large companies have cut headcount significantly this year.
Some companies are taking these steps, noting that they will put a renewed focus on staying efficient and lean, thereby ending the pandemic’s job boom and the era of “fake jobs”. Justifying layoffs.
Others point to a pivot to focus on business sectors with more potential.
Among them, a handful of companies, such as Meta, Google, and Dropbox, specifically point to a new or renewed focus on artificial intelligence in their layoff memos to employees.
Mark Muro, a senior fellow at the Brookings Institution who studies the impact of AI on the economy, said some companies may now be using the AI argument simply as an excuse to cut jobs. thinking about.
“Many companies gave up skiing in the first year of the pandemic due to over-hiring,” he said. “AI explosion may be a convenient explanation for normal mismanagement.”
A pivot to AI could ultimately mean that these companies will have stronger teams working on AI products, as well as an increased need for machine learning engineers and natural language processing specialists. The money to hire those people has to come from other departments.
“The next stage of growth will require a mix of different skill sets, especially in AI and early-stage product development,” Dropbox CEO Drew Houston said in a message to staff announcing the layoffs. said in
At the same time, the focus on AI could mean that some jobs will disappear entirely. It cannot be ignored that AI tools are already adept at some specialized tasks that once belonged to the realm of humans, such as composing emails, analyzing data, and even coding.
Muro agrees that for some companies, the application of large-scale language models such as ChatGPT and GPT-4 could have a “significant impact” on their daily operations.
For example, the CEO of Genies, an avatar tools startup, recently purchased ChatGPT for all employees to streamline the company’s workflow.
That’s why Muro thinks a healthy dose of paranoia might be worth it for everyone right now.
“I think every worker needs to ask themselves what they bring to their job and whether they are doing irreplaceable work,” Muro said. “That question is getting harder to answer now.”
Below is a list of companies that cited AI in their announcements about layoffs and hiring freezes.
buzzfeed
Buzzfeed CEO Jonah Peretti said the company will “bring AI enhancements to every aspect of the sales process” after announcing a 15% workforce reduction. Lucy Nicholson/Reuters
In late April, Buzzfeed announced it would cut 15% of its staff and shut down its news division entirely.
The news comes just months after the company announced it would use AI to generate articles. The decision initially caused the company’s stock price to soar by 200%.
In a memo to staff announcing the layoffs, CEO Jonah Peretti said that in addition to “reducing layers” in its business organization, the company “will begin bringing AI enhancements to every aspect of the sales process.” said.
Later in the memo, Peretti said the company will “work together to run a more agile and focused business organization,” which includes “more in the form of creators, AI and cultural moments.” of innovation to our clients.”
drop box
Dropbox CEO Drew Houston called for “expansion” of AI products in a layoff memo to employees in April. Matt Winkelmeyer/Getty Images
In late April, cloud storage company Dropbox announced it was laying off 500 people.
Dropbox CEO Drew Houston said in a memo to employees that some job cuts are being made so the company can focus on expanding its AI offerings.
“The AI era of computing has finally arrived. We have long believed that AI will give us new superpowers and completely transform knowledge work,” Houston wrote. “And as this year’s product pipeline shows, we’ve been building for this future for a long time.”
Google
Google CEO Sundar Pichai said one of the reasons he saw an opportunity in the future despite laying off 12,000 employees was the company’s “early stage in AI.” investment in Mateusz Wlodarczyk/NurPhoto via Getty Images
In late January, Google CEO Sundar Pichai announced that the company would cut 12,000 jobs, or about 6% of the company’s workforce, after overhiring over the past two years.
Pichai did not provide details of the sectors affected, but said the cuts would affect entire product areas, functions, levels, and regions.
Despite the “tough choices” the company has been forced to make, Pichai argued that the company still has significant growth opportunities thanks to its early investments in AI.
“We are ready to share a whole new experience for users, developers and businesses alike,” he wrote. “There is a huge opportunity in front of us to use AI across our products, and we are ready to tackle it boldly and responsibly.”
IBM
IBM Chief Executive Arvind Krishna told Bloomberg that the company is suspending hiring for jobs that could be replaced by AI. Brian Ach / Correspondent / Via Getty
On Monday, IBM CEO Arvind Krishna said the company expects to pause hiring for jobs that could be replaced by AI.
These include roles in areas such as Human Resources and other non-consumer facing sectors, which currently reach 26,000 jobs.
“We could easily see that 30% of that would be replaced by AI and automation in five years,” Krishna told Bloomberg, or about 7,800 jobs.
In a statement to Insider, an IBM spokesperson clarified that there was “no blanket hiring ‘pause’.”
“IBM is very selective in filling jobs that are not directly related to clients or technology, with a focus on revenue-generating roles.” We are hiring.
meta
Meta CEO Mark Zuckerberg said Meta’s biggest investment was in advancing AI when the company announced in March that it would lay off 10,000 employees. Jonathan Ernst/Reuters
In mid-March, Meta announced that it would cut about 10,000 employees and close 5,000 open positions over the next few months.
In the memo announcing the hiring cuts, Zuckerberg also highlighted the company’s renewed focus on AI as a growth area.
“We are focused on the long term,” wrote the CEO. “That means investing in the tools that will make us most effective, not just this year, but for years to come. That means building AI tools that help engineers write better code faster. , allowing workloads to be automated over time, and identifying obsolete processes that can be phased out.”
Zuckerberg then said the company’s “single biggest investment” is advancing AI and building it into all of its products.
“I think we have the infrastructure to do this on an unprecedented scale, and the experiences it enables will be amazing,” he added.
