1 in 4 CEOs expect to sack staff due to AI this year — PwC survey

A quarter of CEOs in a PwC survey said they anticipate laying off staff this year due to AI, though firms may also be offsetting the cuts with hiring in other areas.

Around a quarter of global CEOs intend to lay off at least 5% of their workforce due to generative artificial intelligence (AI), according to a new survey from PricewaterhouseCoopers (PwC).

The Jan. 15 published survey had responses from over 4,700 CEOs from 105 countries, with over half of the surveyed CEOs leading organizations that post over $100 million in yearly revenue.

Just under a third said their company has already adopted generative AI into their operations, with 25% of CEOs expected to sack at least 5% of their staff due to the technology.

PwC’s report adds, however, that firms making headcount reductions in some areas for efficiency may “already be offsetting them with hiring in others.”

“Although 14% of technology CEOs anticipate reducing headcount in the next year due to generative AI, 56% also anticipate hiring in 2024.”

The media, entertainment, banking, capital markets and insurance sectors were more likely to make staff cuts due to generative AI technology, while engineering, construction, technology, metals and mining industries appeared to be the safest from AI-fueled layoffs. 

Around 70% of CEOs said that within three years, they expected AI to change their business models within three years and require their employees to develop new skills.

AI could impact 40% of all jobs and worsen inequality: IMF

The survey results came just a day after International Monetary Fund (IMF) managing director Kristalina Georgieva shared an analysis that found 40% of all jobs are exposed to AI, and the technology could aggravate inequality.

Georgieva said AI could exacerbate inequality, as around half of the jobs exposed to AI could see productivity benefits from integrating the technology, leading to disproportionately higher wages.

Meanwhile, the other half could see AI take over human jobs — lowering wages, labor demand and hiring.

Related: WEF Davos 2024: A focus on AI and clearer crypto regulations

“In the most extreme cases, some of these jobs may disappear,” Georgieva added.

“Many of these [emerging markets and low-income] countries don’t have the infrastructure or skilled workforces to harness the benefits of AI, raising the risk that over time the technology could worsen inequality among nations.”

She said it’s crucial for countries to create social safety nets and offer programs for workers put at risk by AI.

The technology’s impact is expected to be a prominent topic at the World Economic Forum in Davos, which will be attended by Big Tech executives and world leaders.

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