According to a recent January 2024 PwC survey released in January 2024, approximately 25% of CEOs globally intend to implement layoffs affecting at least 5% of their workforce due to the adoption of generative artificial intelligence (AI).
The survey, which collected responses from over 4,700 CEOs across 105 countries, revealed that nearly one-third of them acknowledged incorporating generative AI into their business operations.
However many organizations implementing staff reductions for efficiency may be counterbalancing these cuts by making hires in other specific areas.
“While 14% of technology CEOs expect to decrease head count in the coming year due to generative AI, 56% also anticipate engaging in hiring activities in 2024.”
The findings reveal that industries such as:
- Media
- Entertainment
- Banking
- Capital markets, and
- Insurance
are more predisposed to enact staff reductions as a consequence of generative AI.
Conversely, sectors like:
- Engineering
- Construction
- Technology
- Metals, and
- Mining
appear to be less vulnerable to layoffs associated with AI implementation.
Around 70% of CEOs foresee a transformation in their business models within the next three years due to AI, requiring their employees to acquire new skills within that timeframe.
When CEOS were asked the Question: To what extent will generative AI impact headcount in your company in the next 12 months?
“Leading companies are aligning their generative AI strategy with their existing digital and AI strategies, upskilling employees, and encouraging experimentation across their organisations with a focus on identifying use cases that can be scaled up,” says the report.
According to Kristalina Georgieva, the Managing Director of the International Monetary Fund (IMF), 40% of all jobs could be impacted by AI, potentially exacerbating existing inequalities. According to Georgieva, approximately half of the jobs affected by AI may see productivity benefits, leading to increased wages.
However, the other half might face AI replacing human roles, resulting in:
- Reduced wages
- Diminished labor demand, and
- Fewer job opportunities
“Many of these emerging markets and low-income countries don’t have the infrastructure or skilled workforces to harness the benefits of AI, raising the risk that over time the technology could worsen inequality among nations,” says Georgieva.
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