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Amid growing adoption of artificial intelligence (AI), IBM announced on Tuesday that it will be letting go of thousands of employees before the end of the year.
The cloud giant said it will cut jobs amounting to a “low single-digit percentage” of its global workforce. As per the latest estimates, IBM has around 2,70,000 workers globally, which means that even a one per cent cut would result in the loss of at least 2,700 jobs.
“In the fourth quarter, we are executing an action that will impact a low single-digit percentage of our global workforce. While this may impact some US-based roles, we anticipate that our US employment will remain flat year over year,” a company spokesperson was quoted as saying by CNBC.
IBM’s announcement comes as several tech giants are looking to shrink their headcount by increasing their reliance on AI tools to improve productivity. While these job cuts have jolted corporate America, there are signs that no one is safe, as most of these companies also operate large offices in countries like India and maintain a sizeable presence here.
Most recently, Amazon announced that it will lay off about 14,000 corporate employees in an effort to reduce bureaucracy as part of its multi-year plan to cut costs in the age of AI. It is said to be the largest round of layoffs in Amazon’s history, with some reports even stating that the total number of job cuts could reach as high as 30,000.
Meanwhile, IBM reported stronger earnings than expected in October with a 10 per cent jump in revenue from software. Arvind Krishna, the CEO of the tech giant, is said to have helped expand IBM’s revenue base since replacing Ginni Rometty in 2020.
In May, Krishna said that AI agents had automated the work of about 200 people in IBM’s human resources department, which subsequently allowed the company to hire more salespeople and software developers.
Earlier, Krishna said that AI will not replace programmers but will instead boost their productivity. Disagreeing with Anthropic CEO Dario Amodei’s prediction that 90 per cent of code may be written by AI in the next three to six months, Krishna said, “I think the number is going to be more like 20-30 per cent of the code could get written by AI—not 90 per cent. Are there some really simple use cases? Yes, but there’s an equally complicated number of ones where it’s going to be zero.”
He was speaking at the SXSW (South by Southwest) event held in March this year.
