Tech Layoffs Rise yet Businesses Seek to Plug AI Skills Gaps

With job cuts continuing across the job sector, AI Magazine considers if companies are looking to upskill their workforces on account of rising AI

Large technology companies are continuing to lay off swathes of employees, contributing to public anxieties about the power of artificial intelligence (AI).

Microsoft, Amazon, Google and Dell are just some of the big tech organisations that have committed to letting more than 57,000 members of their combined workforces go in 2024 alone, with more expected in the coming months.

This compares to nearly 1,200 tech companies laying off 263,180 people in 2023. Reasons given were rebalancing from the hiring boom in the wake of the COVID-19, increased competition in an explosive digital market and restructuring business areas partly to prioritise AI.

Despite this, companies remain in need of highly skilled workers to train and deploy their AI models.

A need to build strong AI teams

Some have blamed the job cuts on AI, suggesting that businesses are considering emerging technologies to ‘plug gaps’ in their strategies, increasing efficiency and reducing costs. In a recent survey by McKinsey, 25% of business professionals said they expect job cuts within their workplace on account of increased AI adoption.

However, it can be argued that these organisations are instead seeking to build more specialised teams that can handle AI better.

New research from Advania, a Microsoft partner, reveals that the complexity of IT systems is delaying actual progress when it comes to harnessing new technologies to their full potential. It cites that 81% struggle to scale, update and future-proof their underlying tech stacks.

Likewise, 98% acknowledge that their IT complexities consist of:
  • Limited understanding of AI’s potential for their organisation
  • Existing technical debt and confused budget spending
  • Net-Zero knowledge gap

Hexaware found that nearly three-quarters of UK businesses alone are struggling to find AI talent. In order to avoid project failures, businesses are investing time into hiring into AI areas of the business, resulting in job cuts in other areas.

Upskilling: A commitment to enterprise AI

Despite concerns over AI and automation replacing humans, it is human skills that are still integral to enterprise development. In fact, a recent study by HSBC revealed that the majority of businesses are considering how emerging technologies like AI could advance the skillsets of their employees. 

Likewise, these business leaders are planning to re-train their workforce to utilise the technology to its full potential. 

For instance, the new AI consortium, consisting of some of the largest tech companies, is also hoping to dispel any suggestion that AI will result in job losses. The consortium is keen to prioritise the need for re-skilling and upskilling workforces, particularly within the IT sector. 

It will also evaluate the impact of AI across 56 job roles, not yet specified, and provide the relevant training and recommendations for the roles impacted.

A focus on upskilling, rather than re-hiring or cutting jobs, could enable companies to refocus their efforts on digitally transforming on a much larger scale.

Nick Isherwood, Chief Information Officer at Advania, says “The mid-market is smart and competitive, yet IT complexities act as significant roadblocks to them. Many just focus on one-time fixes when there are problems, but don’t recognise the need to be set up for constantly evolving circumstances. This leads to them not being able to focus on other priorities like AI and Net-Zero, they’re distracted by their IT complexities.

"Organisations need to consider their specific needs, the market they play in, the contextual threats they face, and flex their budgets accordingly. That’s where we add the greatest value.”

************

Make sure you check out the latest edition of AI Magazine and also sign up to our global conference series - Tech & AI LIVE 2024

************

AI Magazine is a BizClik brand

Share

Featured Articles

Hitachi Partner with Google to Expand GenAI Enterprise Offer

Hitachi is entrenching GenAI into its operation through partnership with Google Cloud and creation of the new Hitachi Google Cloud Business Unit

Why xAI's $6bn Win Could Make Musk's Grok a GenAI Contender

Elon Musk's xAI received $6bn in funding, which it will utilise to accelerate the development of its flagship product, the GenAI chatbot Grok

GP Bullhound: AI Pivotal in European Tech Investment Drive

GP Bullhound has released a report that states Europe's tech ecosystem is placed for unprecedented growth, driven by the growth in AI

AI in SOC: Where Should Security Teams Look to Apply It?

AI Strategy

Swiss Re: Pharma, Not IT, to See Most Adverse Effects of AI

AI Strategy

AI Safety Summit Seoul: Did it Meet Industry Expectations?

AI Strategy