The Role of AI in Recent Tech Layoffs
Artificial intelligence (AI) is playing a significant role in the recent wave of job cuts in the tech sector. As of July 12, layoffs in the tech industry have exceeded 100,000, according to data from Layoffs.fyi and reported by Seeking Alpha.
Companies Affected
Among the companies recently announcing layoffs is Intuit, the maker of TurboTax and QuickBooks. Intuit has announced it will be cutting 1,800 roles as it shifts its focus towards AI. However, these positions are not being replaced by AI bots. Instead, Intuit plans to hire an equal number of workers with AI expertise.
Similarly, UiPath is eliminating 420 positions, and OpenText is cutting 1,200 jobs but plans to eventually hire 800 new employees in sales, professional services, and engineering roles.
Impact on the Workforce
The 2024 Economic Report of the President indicates that up to a fifth of America’s workforce is at high risk of AI-related job displacement. A recent report from Citi also shows that 54% of jobs in the banking sector have a high potential for automation, with another 12% potentially being augmented by AI.
“AI-powered clients could increase price competition in the finance sector. The balance of power may shift,” Citi stated in its report.
However, the report also raises concerns about compliance, security, regulation, and ethics in a bot-powered world. “Since AI models are known to hallucinate and create information that does not exist, organizations run the risk of AI chatbots going fully autonomous and negatively affecting the business financially or its reputation,” Citi warned.
Future Outlook
In an interview with PYMNTS, Javed Khan, Senior Vice President and General Manager of Cisco Collaboration, shared insights on how AI is transforming the work landscape. “A commonality with most technological advancements throughout history is that they ultimately delivered a significantly better experience than before. AI will be no different,” Khan said. “We’re already seeing the benefits that AI can bring to the workplace and beyond, empowering us all to reimagine how we connect and collaborate.”
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