Tech firms have already let go more than 7,500 employees in January 2024, according to tracking website Layoffs.fyi. In particular, Google said it was laying off hundreds of employees across multiple teams, while Amazon laid off several hundred employees in its streaming and studio operations.
Last year (2023) was reported as one of the worst years for layoffs in the technology industry, estimating that more than 200,000 roles were eliminated. Widespread job cuts are set to continue in 2024, with businesses keen to make good on their AI advancements.
AI remains integral to technology business strategies
The digital transformation boom that came in the wake of the COVID-19 pandemic caused an unprecedented shift for businesses. A heightened demand for newly developed technologies such as generative (Gen AI) resulted in companies hiring more staff to meet the needs of their customers. However, the situation has now plateaued alongside AI having developed to the point of being completely transformative, resulting in mass layoffs.
With many companies citing AI as their reasoning for letting large swathes of their workforces go, it is clear that AI adoption is set to increase even further in 2024.
“No company wants to get left behind by the AI revolution and they are all making sure they have these capabilities and are prioritising them, even when it is at the expense of other initiatives,” D.A. Davidson & Co analyst Gil Luria told the Reuters news agency.
According to an AWS report, AI will continue to shape the global business landscape in 2024, with 90% of workers surveyed anticipating AI integration into their daily work by 2028.
Google and Amazon are already investing in their AI efforts to compete with Microsoft. In December 2023, Google unveiled its long-awaited Gemini model, while Amazon is reportedly developing a model to compete with ChatGPT-maker OpenAI's GPT-4, having announced its Amazon Q tool in November.
Likewise, NVIDIA and AMD continue to enjoy stock market success, with demand for their AI chips continuing to soar - partly due to greater swathes of businesses seeking to adopt Gen AI. This is in addition to Meta officially starting to train Llama 3, its latest Gen AI model, in order to make moves towards developing artificial general intelligence (AGI).
The importance of upskilling, rather than job cutting
However, with such transformations taking place, it is also crucial for business leaders to consider recruiting highly-skilled talent or upskilling existing employees. With ever-growing skills gaps threatening the technology industry, enterprises face the urgent task of bridging the divide.
Recognising the importance of maintaining a skilled workforce is vital within AI sectors, as companies need to remain resilient to stay ahead of an ever-evolving industry.
SAP is one company that is also restructuring, but has also committed itself to upskill 8,000 jobs so that the organisation can focus on growth in AI-driven business areas. Re-skilling programmes such as these could address widespread business concerns and allow human workforces to better work in collaboration with AI models.
“Organisations are at a critical point where they need to be deliberate and proactive about building skills and capabilities – especially related to AI – or risk falling behind in the coming year. Interactive training experiences where professionals learn by doing will unlock rich possibilities, creating business value while increasing team member engagement and morale.”
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