New research from a leading human resources consulting firm suggests that the number of these lost jobs may be underreported. — Photo by Igor Omilaev on Unsplash
If you ask ChatGPT if the technology behind it is stealing people’s jobs, the response is telling: “AI is changing the job market by automating certain tasks, which can reduce the need for some roles, especially repetitive or data-driven jobs,” it admits. Then it adds a positive spin that aligns with an idea AI hawks are promoting, noting that AI “also creates new opportunities in tech, Al development, and industries adapting to new technologies.”
While few reports say AI is actually creating new jobs, other, more critical reports suggest it’s actually taking plenty of people’s work away. New research from a leading human resources consulting firm suggests that the number of these lost jobs may be underreported. That means AI may already be replacing human workers at a much higher rate than anyone realises.
Executive outplacement firm Challenger, Gray & Christmas, based in Chicago, reports that research into AI job replacement found that only 75 actual job cuts in the first half of the year in the US were explicitly linked to AI, according to industry news site HRDive. The firm trawled through public data, including statements made by other companies, as well as government filings. It concluded that while tech-linked factors like automation did play a role in some 20,000 job cuts, a startlingly low total were directly attributed to AI replacing humans.
“We do see companies using the term ‘technological update’ more often than we have over the past decade,” Andy Challenger, a senior vice president at the firm, explained in an interview. He voiced his own suspicion that “some of the AI job cuts that are likely happening are falling into that category,” without being directly blamed on AI.
This might seem confusing, since the fact that many companies are adopting AI is public knowledge. Big names like Meta openly state that they are reducing the number of people in certain roles because the efficiencies or technical abilities of AI tools mean they can take on the duties of some employees, such as mid-level coders at Meta. Challenger suggested one reason for the low number of job reductions explicitly linked to AI adoption by businesses: It might be because certain firms simply “don’t want press on it,” he said. This notion might track for companies that are sensitive to their public image or that traditionally control the media narrative around their business carefully, like Apple.
Challenger’s report says that of the over 744,000 jobs cut in the US in the first six months of the year, cuts directly related to DOGE-led efforts took the biggest share, at nearly 287,000 people. “Market and economic conditions” were the second-most-cited reason for workforce downsizing, responsible for over 154,000 job losses, the data show.
Compared to these figures, the mere 75 roles directly lost to AI sounds all but unbelievable, lending support to Challenger’s assertion that companies are hiding AI-related job cuts under other labels.
Part of the issue here is that while some companies are making bold assertions about the quantity of work that AI is performing – Microsoft and Google’s CEOs recently said AI is writing upwards of 30 percent of the code these companies rely on. Other tech leaders, such as Amazon’s Andy Jassy, are warning, sometimes clumsily, that AI will lead to staffing cuts. The fact is, even AI experts don’t know how much AI will impact existing jobs across the world economy.
A lively spat between billionaire entrepreneur Mark Cuban and Dario Amodei, CEO of leading AI company Anthropic, over the risk AI presents to white-collar jobs provides a great example. In an interview, Amodei warned AI could wipe out half of all entry-level white-collar jobs inside the next five years. Cuban, no stranger to successful high-tech businesses, fired back on social media that “Someone needs to remind the CEO that at one point there were more than 2m secretaries. There were also separate employees to do in-office dictation.” Cuban was referencing the workforce revolution that ubiquitous computer and smartphone tech has brought to the office. He concluded that “New companies with new jobs will come from AI and increase TOTAL employment.”
This confusion could also be why some companies may be hiding AI-related downsizing in other categories in their public statements: No company leader wants to look like they’ve made a big business mistake by jumping on the latest, buzziest bandwagon if it later proves to have been a bad idea. – Inc./Tribune News Service
