The impact of artificial intelligence (AI) on employment is rapidly becoming a reality, as highlighted in a recent report by Challenger, Gray & Christmas. In the month of May alone, the technology led to the layoff of approximately 3,900 individuals, signifying a significant shift in the job market landscape.
This shift in the job market landscape raises concerns about the widespread impact of AI technology.
The report unveils a 20% increase in job cuts compared to April, with AI being cited as a contributing factor for the first time. The tech industry bore the brunt of these job losses, as all 4,000 AI-related layoffs were concentrated in this sector.
Although specific companies involved in the AI-related layoffs were not disclosed in the report, institutions like Deutsche Bank AG, ING Group NV, Morgan Stanley, and JPMorgan Chase & Co. have been actively integrating AI into their operations.
While some organisations leverage AI to assist employees by automating repetitive tasks, others are expanding their AI teams to maintain a competitive edge in the ever-evolving business landscape.
Previously, Goldman Sachs had predicted that 18% of global work, particularly white-collar jobs, and a substantial portion of tasks in the US and Europe could be automated. The report warned that AI is expected to replace the equivalent of 300 million full-time jobs.
The report emphasises that roles in computer science, finance, administration, and law are at higher risk of automation compared to blue-collar jobs that involve physical labor.
AI's capability to automate complex tasks, such as generating performance reports and coding, which traditionally require extensive human training, makes it an appealing solution for companies seeking cost-effective and efficient alternatives.
The increasing impact of AI on the job market calls for adaptation from both individuals and industries. As AI continues to reshape work dynamics, it becomes crucial to focus on upskilling and reinvention in order to thrive in the digital era.