A recent survey by PricewaterhouseCoopers (PwC) indicates that around 25% of global CEOs plan to reduce their workforce by at least 5% due to the implementation of generative artificial intelligence (AI). The survey, released on January 15, gathered responses from over 4,700 CEOs in 105 countries, with more than half leading organizations with annual revenues exceeding $100 million. Less than a third of respondents stated that their companies currently utilize generative AI in operations. Of those surveyed, 25% of CEOs expect layoffs of at least 5% of their employees due to generative AI technology.
However, the report suggests that companies making cuts in certain areas to enhance efficiency may have already offset the impact by hiring in other areas. While 14% of tech CEOs anticipate headcount reductions in the coming year due to generative AI, 56% also anticipate hiring in 2024. Industries such as media, entertainment, banking, capital markets, and insurance are more likely to experience layoffs due to generative AI, while engineering, construction, technology, metals, and mining industries seem more resilient to AI-induced job cuts. Approximately 70% of CEOs believe that artificial intelligence will change their business models within three years, requiring employees to acquire new skills.
The findings align with a recent analysis by International Monetary Fund (IMF) Managing Director Kristalina Georgieva, revealing that around 40% of jobs are impacted by manual labor and that AI may exacerbate inequality. Georgieva warned that AI could lead to significant wage increases for about half of the jobs exposed to it, while the other half may experience lower wages, reduced labor requirements, and potential job displacement. She emphasized the need for countries, particularly those without the necessary infrastructure or skilled workforce, to establish social safety nets and worker programs to address AI-related risks.
The impact of technology on employment is expected to be a prominent topic at the upcoming World Economic Forum in Davos, with the participation of executives from major tech companies and world leaders.
