Multiple reports have suggested that technology either has or will impact the workforce. Concerns about AI leading to job reductions are becoming more prevalent, particularly with the increasing utilization of this technology.
In January, Duolingo downsized 10% of its contractors, citing a decreased necessity for the type of work these contractors were engaged in, partly due to AI implementation. This reduction in workforce was not a direct substitution of employees with AI, as clarified by a spokesperson.
Prior to a subsequent wave of layoffs in the tech sector in January, there were indications of companies integrating their AI solutions. For instance, Google was reported by The Information in December to be increasingly utilizing machine-learning methods to facilitate ad purchases, causing unease among ad sales teams, eventually leading to job cuts. However, Google’s spokesperson denied any link between these layoffs and the adoption of AI tools.
While concerns have been raised by freelancers and individual workers regarding AI systems like ChatGPT potentially displacing their work, companies undergoing layoffs have generally not attributed the downsizing to AI directly. Rather, the investment in AI development by companies might be contributing to cutbacks in other areas.
Although AI may not be directly replacing human workers, the emphasis on AI development by companies could be influencing reductions in workforce in various sectors. Companies like SAP and Klarna have announced strategic shifts towards AI, impacting thousands of employees’ roles.
Despite the increasing discussion around AI’s role in tech companies, the current scenario does not necessarily indicate a widespread trend of AI-related layoffs. Experts suggest that economic dynamics such as outsourcing and cost-cutting strategies are more significant factors influencing job changes than the direct impact of AI.
Industry leaders are eager to demonstrate their readiness to leverage AI, with a significant percentage of Fortune 500 chief human resources officers foreseeing job replacements by AI in the near future. However, concrete evidence of widespread job automation by AI remains scarce, with its role in the labor market being described as more augmentative than substitutive.
Tech analyst Dan Ives predicts ongoing redundancies throughout the year as companies shift their focus towards AI investments, which often involve high costs and intense competition for AI talent. While the prevalence of AI in tech operations is expected to rise, caution is advised against solely attributing layoffs to AI when other conventional factors may also be at play.
In a statement to Business Insider, Duolingo explained that the reduction in contractor workforce was due to project completion or changes in content generation processes across their language courses, emphasizing efforts to find alternative roles before letting go of contractors. Klarna chose not to provide further details on their decision to freeze hiring.
