IBM CEO Announces Hiring Freeze, Artificial Intelligence Advancements to result in 7800 Job losses

IBM

IBM: CEO of International Business Machines Corp. Arvind Krishna stated that the corporation anticipates pausing hiring for positions that it believes artificial intelligence would eventually replace. That would result in a loss of about 7,800 jobs. According to an IBM representative, any cut would also involve not filling positions lost to attrition.

Artificial Intelligence technologies has grown due to their capacity to produce language

According to Krishna, ‘hiring in back-office roles like human resources will be stopped or slowed down.’ He added, ‘these non-customer facing positions employ about 26,000 people. Over a five-year period, I could easily see automation and AI replacing 30% of that.’ As the public’s fascination with artificial intelligence technologies has grown due to their capacity to produce language, generate code, and automate customer service, many analysts have expressed concern about how this would affect the labour market. One of the most significant workforce initiatives to be announced in response to the quickly developing technology is Krishna’s plan.

The business is thinking about selling its weather segment

Since 2020, Krishna, the CEO, has pushed to concentrate the century-old business on software and services like hybrid cloud. He has sold off lower-growth companies including Watson Health and a portion of the managed infrastructure unit Kyndryl Inc. The business is thinking about selling its weather segment. Krishna asserted that he thought the US could escape a recession until late 2022. Now, he anticipates the possibility of a “shallow and brief” recession by the year’s end. Anurag Rana of Bloomberg Intelligence noted last week that the company’s strong software portfolio, which includes the recently acquired Red Hat segment, should enable it continue stable growth despite growing macroeconomic concerns.

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Company is always looking to fill positions in customer service and software development

About 260,000 people work for IBM currently, and the company is always looking to fill positions in customer service and software development. According to Krishna, it’s simpler to find talent now than it was last year. Earlier this year, the corporation announced job cuts that, when finished, may affect 5,000 employees. Krishna claimed that despite this, IBM increased its overall staff by around 7,000 individuals in the first quarter. IBM, situated in Armonk, New York, exceeded profit expectations in its most recent quarter thanks to cost control measures, including the previously disclosed job layoffs. Chief Financial Officer James Kavanaugh stated on the day of earnings that new productivity and efficiency measures are anticipated to generate $2 billion in annual savings by the end of 2024.

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