IBM could replace 7,800 jobs with artificial intelligence, CEO says

IBM Corp. said it expects to pause hiring for jobs that artificial intelligence could do, indicating that the technology is beginning to disrupt how humans work.

Arvind Krishna, the company’s chief executive, estimated up to 7,800 jobs at the company could be affected, according to an interview with Bloomberg News on Monday, and hiring in back-office roles such as human resources could be at risk of being suspended or slowed down.

“There is no blanket hiring ‘pause’ in place,” Adam R. Pratt, an IBM spokesman, said in a statement. “We’re being very selective when filling jobs that don’t directly touch our clients or technology.”

As generative artificial intelligence becomes eerily lifelike and gives rise to chatbots that can draft letters, write code or create songs, experts have warned about its ability to put people out of jobs. A Goldman Sachs report in late March said generative AI could significantly disrupt the global economy and subject 300 million jobs to automation.

Krishna’s statements are an early indication of how widespread generative AI’s impact could be inside corporations. Chegg, the online learning company, also said on Monday night that the viral chatbot, ChatGPT, is affecting its customer growth rate, causing its stock price to tank. While AI is likely to impact the workforce, economic analysts also cautioned that it’s still too early to tell how disruptive it’ll be.

“I think almost every job will change as a result of AI,” said Tom Davenport, a professor of information technology and management at Babson College. “It doesn’t mean those jobs will go away.”

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In recent months, the general public has been dazzled by the capabilities of generative artificial intelligence, referring to software that creates text, images and video based on data it’s fed. OpenAI’s ChatGPT has penned heartfelt poems. Image-makers such as Midjourney have created pictures convincing people that the Pope wears Balenciaga. The rapper Drake’s voice has been cloned to create a song he didn’t sing.

While the products’ creative outputs have been lauded, they’ve also brought worry that rote administrative jobs will be replaced. Goldman Sach’s March report predicted 18 percent of the global work could be computerized, with white-collar workers more at risk than manual laborers.

In particular, the report noted that administrative workers and lawyers would be particularly affected, rather than construction workers or maintenance professionals.

Krishna, who has been IBM’s CEO since 2020, said in his interview that rote tasks such as providing employment verification letters or shifting employees between departments could be fully automated. Other human resources functions, such as evaluating workforce productivity would be less likely for automation.

Of the company’s 26,000 non-customer facing roles, Krishna said he “could easily see 30% of that getting replaced by AI and automation over a five-year period.”

AI is also starting to financially affect other companies. After Chegg CEO Dan Rosensweig said in his company’s Monday evening earnings call that ChatGPT is slowing his customer-growth rate, the company’s stock fell 45 percent as the market opened Tuesday.

“This is not a sky’s falling thing,” Rosensweig said. “It’s just an acknowledgment that there’s been a technological shift. And we need to prepare for it and adjust our company and go after it aggressively and adjust our cost structure to do so.”

Davenport, of Babson College, said AI will likely affect how people do their jobs, but predictions saying it will put thousands of people out of work seem exaggerated. “We just have a poor record of predicting what jobs will go away,” he said.

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He said most jobs involve many different tasks, not just a few that are replaceable by artificial intelligence. He added that if generative AI becomes more widespread in the workforce, people’s jobs could likely evolve rather than go away.

“[When] one task goes away, another task comes along to replace it,” he said. “Humans are pretty enterprising about finding new ways to be valuable.”

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