Arvind Krishna, the CEO of International Business Machines Corp. (IBM), stated that the corporation anticipates pausing hiring for positions that it believes artificial intelligence would eventually replace.
According to Krishna, hiring in back-office roles like human resources will be stopped or slowed down. According to Krishna, these non-customer-facing positions employ about 26,000 people. “Over a five-year period, I could easily see automation and AI replacing 30% of that.”
That would result in a loss of about 7,800 jobs. According to an IBM representative, any cut would also involve not filling positions lost to attrition.
With the ability to automate customer service, compose text, and generate code, artificial intelligence tools have attracted the public’s attention. However, many observers are concerned about how they might affect the labor market. One of the most significant workforce initiatives to be announced in response to the quickly developing technology is Krishna’s plan.
According to Krishna, more routine procedures like sending letters confirming hiring or transferring personnel across departments would probably be totally automated. Over the next ten years, some HR tasks, like assessing productivity and workforce composition, are likely not to be replaced.
About 260,000 people work for IBM currently, and the company is always looking to fill positions in customer service and software development. According to Krishna, it’s simpler to find talent now than it was last year. Earlier this year, the corporation announced job cuts that, when finished, may affect 5,000 employees. Krishna claimed that despite this, IBM increased its overall staff by around 7,000 individuals in the first quarter.
Since 2020, Krishna, the CEO, has pushed to concentrate the century-old business on software and services like a hybrid cloud. He has sold off lower-growth companies including Watson Health and a portion of the managed infrastructure unit Kyndryl Inc. The business is thinking about selling its weather segment.
IBM situated in Armonk, New York, exceeded profit expectations in its most recent quarter thanks to cost control measures, including the previously disclosed job layoffs. By the end of 2024, new productivity and efficiency measures, according to chief financial officer James Kavanaugh, could provide US$2 billion in savings annually.
Krishna asserted that he thought the US could escape a recession until late 2022. He now anticipates the possibility of a “shallow and short” recession before the year’s end. Anurag Rana of Bloomberg Intelligence noted last week that the company’s strong software portfolio, which includes the recently acquired Red Hat segment, should enable it to continue stable growth despite growing macroeconomic concerns.
