Why Artificial Intelligence is Responsible for Layoffs

This week, Stack Overflow announced their second round of layoffs this year. Stack Overflow CEO Prashanth Chandrasekar explained in his blog that the initial restructuring efforts were not enough, "We had to make extremely difficult decisions to reduce the company's workforce by 28%."

The number of layoffs in the tech industry has increased significantly this year. January saw the highest number of layoffs, with continuous layoffs throughout the year. The human resources department has been hit hard, followed by software engineers, with 22.1% of employees being laid off this year.

Using Stack Overflow as an example, users prefer to use ChatGPT instead of this 15-year-old website to help solve coding problems, leading to a sharp decline in traffic. This is the first time that artificial intelligence has replaced humans. Microsoft's LinkedIn also announced layoffs, reducing their workforce in engineering, talent, and product departments. E-commerce platform Dukaan laid off 90% of its support staff earlier this year and replaced them with artificial intelligence. The CEO of the company stated that this significantly reduced their customer response time.

Each company's layoffs are the result of multiple factors, but the increasing use of artificial intelligence in the workplace is gradually threatening human labor.

Artificial Intelligence and Human Resources

According to a report by Goldman Sachs, most automatable jobs have already been taken over by artificial intelligence. Nowadays, expanding businesses no longer require as much manpower, and technology becomes the default choice. Vin Vashishta predicts, "Reduced hiring means reduced job positions. Streamlined organizations mean smaller human resources departments. As tools become more powerful, sales, marketing, legal, and accounting teams will all shrink in size."

Nischae Suri, Managing Director of Cornerstone OnDemand, said, "Artificial intelligence in the field of human resources is not new; this integration has been ongoing. Generative artificial intelligence has recently sparked an AI race worldwide, with profound effects on all institutions."

Using artificial intelligence to improve operations is common, and this trend is also affecting the field of human resources. Currently, 81% of HR leaders have explored or adopted AI solutions, and this number is likely to increase.

Suri further stated that the potential value of artificial intelligence in the field of human resources is enormous. It can provide insights into talent performance and align employees with relevant learning paths that match their career development goals. However, the rapid development of artificial intelligence and its impact on employees have raised some concerns.

According to Cornerstone OnDemand's latest talent mobility study, 73% of employees express interest in exploring new roles within the company, with a higher proportion of employees preferring to use technology rather than directly talking to managers to explore these new roles. Therefore, using artificial intelligence in HR solutions can recommend learning opportunities, analyze career trajectories, and align key skills with organizational needs.

Meanwhile, the company announced a free AI tool called "Skills Playground," which matches skills with job roles and learning content ontology, has identified over 50,000 skills, and allows visitors to experience AI skill testing firsthand.

This is one of the earliest technologies that use artificial intelligence to simplify HR functions and processes. IBM continues to develop their Watsonx platform and has added functionality for automating processes such as onboarding.

Is Artificial Intelligence Taking Over Jobs?

Currently, there is little evidence to suggest that artificial intelligence is the cause of layoffs. Currently, positions involved in content creation have been directly affected because artificial intelligence can easily generate high-quality content.

News related to layoffs associated with artificial intelligence is rare. Stack Overflow's layoffs were attributed by its CEO to business difficulties caused by macroeconomic factors. LinkedIn may be affected by reduced hiring, as recruitment fees are its largest source of revenue. Nevertheless, artificial intelligence remains a tool that humans use to make work easier, rather than a threat.

It should be emphasized that artificial intelligence is a useful tool that will reduce the number of jobs that require repetitive work and can be automated. In turn, the demand for developers has been increasing over the years. Suri concludes, "The nature of work may change, and some tasks may be automated, but new opportunities will also arise."