In 2023, IBM made headlines when it announced plans to lay off nearly 8,000 employees, many of whom worked in support roles like Human Resources. The goal? To replace them with artificial intelligence (AI), particularly in automating repetitive tasks that were bogging down efficiency. In an era where many tech companies, such as Google and Spotify, were trimming staff to embrace AI and automation, IBM seemed to be following the trend with the hope of saving costs and streamlining operations¹.
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IBM’s strategy was ambitious. The company was betting that up to 30% of its support functions, including HR, could be automated with AI. One of the main innovations was the creation of “AskHR,” an AI-driven chatbot designed to handle a massive portion of HR tasks—up to 94% of them, to be precise. From processing leave requests to managing payroll, AskHR was introduced as a way to increase productivity, and its success promised significant savings. Indeed, the company saved an impressive $3.5 billion by automating these processes, cutting out 70 different roles in the process².
The Unexpected Outcome: Rehiring and Reinventing the Workforce
But then, something unexpected happened. Despite the substantial cost savings from AI automation, IBM found itself rehiring many of those it had laid off. Arvind Krishna, the company’s CEO, explained that while automation had delivered efficiencies, it had also created space for the company to reinvest in higher-value roles. Instead of eliminating jobs altogether, the company used the savings from automation to redirect resources into areas where human expertise was still essential³.
This shift highlights an intriguing trend: rather than eliminating jobs, AI is leading to new opportunities—albeit ones that require different skills. While machines may take over routine, repetitive tasks, there’s now a surge in demand for professionals who can design, manage, and sell AI solutions. The very technology that was meant to reduce the workforce has, in some ways, created a new kind of job market.
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The demand for AI professionals is growing fast. According to a report by LinkedIn, AI-related job postings have increased by over 60% globally between 2020 and 2023⁴.
IBM’s experience isn’t an isolated case. Companies in various sectors, including Duolingo and certain customer service platforms, have experimented with replacing human workers using AI tools like chatbots. However, some of these experiments have yielded mixed results, leading to a return to human specialists who can better handle the nuances and limitations of automation⁵.
The Future of Jobs in an AI-Driven World
The story of IBM and its approach to AI-driven automation raises crucial questions about the future of work in the digital age. According to a report from the World Economic Forum, nearly 92 million jobs could be displaced by automation by 2030. Yet, that same report also highlights a silver lining: as many jobs are displaced, others will be created. The key to surviving and thriving in this new landscape will be for businesses to adapt to the evolving demand for skills, while workers must focus on continuous learning and reskilling⁶.
As automation accelerates, the challenge will lie in preparing the workforce for new roles that require high-tech expertise. Professionals who can manage AI, build systems, and navigate the complexities of automation will be in demand. For workers, it’s not about resisting change but about embracing it. The key to success will be adapting to a future where AI doesn’t simply replace jobs—it redefines them.
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IBM’s journey serves as a powerful reminder that AI is not just a cost-saving tool—it’s part of a broader shift that is reshaping the nature of work itself. By reinvesting the savings from automation into areas that demand human creativity and insight, companies like IBM are proving that the future of work might not be about cutting jobs at all—but about reinvesting in human talent and adapting to a rapidly evolving world.
Footnotes:
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IBM Replaced Hundreds of HR Workers With AI, According to Its CEO. https://www.entrepreneur.com/business-news/ibm-ceo-ai-replaced-hundreds-of-human-resources-staff/491341
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IBM claims $3.5 billion productivity boost through AI agent use. https://www.cio.com/article/3968783/ibm-agent-ai-in-direct-use-delivers-3-5-billion-in-productivity-impact.html
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The future of AI in workforce management: Interview with SVP Technology, Pam Beard. https://www.guidantglobal.com/news/the-future-of-ai-in-workforce-management-interview-with-svp-technology-pam-beard
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AI-related job postings surge despite IT seeing fewer overall. https://www.staffingindustry.com/news/global-daily-news/ai-related-job-postings-surge-despite-it-seeing-fewer-overall
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AI replacement and people displacement.https://uxdesign.cc/ai-replacement-and-people-displacement-10791259a4e7
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The Future of Jobs Report 2023. https://www.weforum.org/publications/the-future-of-jobs-report-2023/