IBM's CEO says 7,800 jobs at the company could be replaced by AI in 5 years

IBM will be slowing down their hiring for jobs that could potentially be done by AI in the future.

IBM's CEO says 7,800 jobs at the company could be replaced by AI in 5 years

Artificial intelligence is a relatively new topic, but the CEO of International Business Machines Corp. has already spoken about how many jobs this technology will replace.

Arvind Krishna, a Bloomberg interviewee, said that IBM employs 26,000. These people are in roles where they don't interact with customers. He said that in the next five-years, AI and automation may replace about 30% of these positions, or 7,800 workers. Krishna stated that the company will stop hiring for these roles in the interim.

Krishna, a Bloomberg reporter, said that the Armonk-based New York company would likely automate tasks in human resources, such as providing letters of employment verification or moving employees within departments.

Krishna's warning on AI-related job losses at the tech giant comes while IBM's business is performing fairly well. It posted its largest annual sales increase for a decade last year. The company announced last month that it had increased its first-quarter profits to $927 from $733.

In the same period last year, IBM made $1.5 million on sales that were up less than 1%. IBM's quarterly dividend was increased by one penny per share last week in response to this report.

Krishna hasn't warned about the impact of AI before. In an earlier interview with the Financial Times, Krishna said that AI would be able do all of the white-collar administrative functions that people currently perform.

IBM has also warned about job cuts in the past. IBM announced in January that it would be laying off 3,900 employees as part of its report on the fourth quarter.

Business Journal research shows that IBM employs about 280,000 people worldwide, but the number of employees in Silicon Valley has decreased over the years. Business Journal figures for 2019 show that IBM employed 1,325 in the region, down from 6,650 people in 2009. IBM spokesman Tim Davidson refused to reveal the company's current Silicon Valley employee count.

In this year, OpenAI LLC’s ChatGPT has become increasingly popular. This application can imitate images, texts and software codes created by people. This development has prompted some companies to discuss how this technology affects their workforce or operations.

Shares of Chegg Inc., a Santa Clara-based company, fell 48% on Tuesday after it warned that ChatGPT would affect its business. Samsung, a South Korean tech giant, announced Tuesday that it will restrict its employees' use of AI-generated apps like ChatGPT after a data leak via the chatbot occurred last month.