IBM CEO Arvind Krishna. Christopher Goodney/Bloomberg via Getty Images
International Business Machines chief executive Arvind Krishna said the company expects to pause hiring for roles it believes may be replaced by artificial intelligence in the next few years. rice field.
In an interview, Krishna said hiring in back-office functions such as human resources would be suspended or slowed down. According to Krishna, these non-customer-facing roles equate to approximately 26,000 employees. “It was easy to see that 30% of that would be replaced by her AI and automation in five years.”
This means about 7,800 jobs will be lost. An IBM spokesperson said part of the layoffs would include not replacing positions vacated by the layoffs.
As artificial intelligence tools capture public imagination for their ability to automate customer service, write text and generate code, many observers worry about the potential to disrupt the labor market. One of the largest workforce strategies announced in response to rapidly advancing technology.
Krishna said more mundane tasks, such as providing employment confirmation letters and moving employees between departments, are likely to be fully automated. Some HR functions, such as assessing workforce composition and productivity, won’t be replaced in the next decade, he added.
IBM currently employs approximately 260,000 people and continues to fill software development and customer facing roles. According to Krishna, finding talent is easier than it was a year ago. The company announced job cuts earlier this year, which could result in about 5,000 employees when completed. Still, Krishna said IBM has increased headcount across the board, hiring about 7,000 people in the first quarter.
As CEO since 2020, Krishna has focused on 100-year-old companies focused on software and services such as hybrid cloud. He sold low-growth businesses, including Kyndryl Inc., a managed infrastructure division, and parts of the Watson Health business. The company is currently considering selling the weather unit.
Armonk, N.Y.-based IBM beat earnings expectations in the most recent quarter on cost controls that included previously announced job cuts. New productivity and efficiency steps are expected to save $2 billion annually by the end of 2024, Chief Financial Officer James Kavanaugh said on the earnings call.
Krishna said he believed the US could avoid a recession until late 2022. Now he sees the possibility of a “short and shallow” recession towards the end of the year. Bloomberg Intelligence’s Anurag Rana said last week that the company’s strong software portfolio, including its acquired unit Red Hat, should help maintain steady growth despite worsening macroeconomic concerns. It writes that
