Has AI just become an easy excuse for firms looking to downsize, asks CNBC:
Fabian Stephany, assistant professor of AI and work at the Oxford Internet Institute, said there might be more to job cuts than meets the eye. Previously there may have been some stigma attached to using AI, but now companies are “scapegoating” the technology to take the fall for challenging business moves such as layoffs. “I’m really skeptical whether the layoffs that we see currently are really due to true efficiency gains. It’s rather really a projection into AI in the sense of ‘We can use AI to make good excuses,'” Stephany said in an interview with CNBC. Companies can essentially position themselves at the frontier of AI technology to appear innovative and competitive, and simultaneously conceal the real reasons for layoffs, according to Stephany… Some companies that flourished during the pandemic “significantly overhired” and the recent layoffs might just be a “market clearance….”
One founder, Jean-Christophe Bouglé even said in a popular LinkedIn post that AI adoption is at a “much slower pace” than is being claimed and in large corporations “there’s not much happening” with AI projects even being rolled back due to cost or security concerns. “At the same time there are announcements of big layoff plans ‘because of AI.’ It looks like a big excuse, in a context where the economy in many countries is slowing down…”
The Budget Lab, a non-partisan policy research center at Yale University, released a report on Wednesday which showed that U.S. labor has actually been little disrupted by AI automation since the release of ChatGPT in 2022… Additionally, New York Fed economists released research in early September which showed that AI use amongst firms “do not point to significant reductions in employment” across the services and manufacturing industry in the New York-Northern New Jersey region.