Do Uber AI Layoffs More American Jobs At Risk?
Uber just cut a chunk of its customer service workforce in the name of AI efficiency, and it is far from alone. The real question is whether these scattered layoffs signal the early edge of a wave that could reshape…
Uber (NASDAQ: UBER | UBER Price Prediction) laid off 10% of its customer service staff as part of what it said was an effort to “embrace artificial intelligence.” Megha Yethatika, Uber’s vice president of global community operations, commented, “Our organization has become too complex and siloed.”
The decision raises, once again, whether AI will cause huge numbers of layoffs across a number of industries, or whether similar announcements from other companies are isolated incidents of AI’s value in narrow parts of businesses.
Part of the panic about layoffs comes, to a large extent, because of highly visible AI downsizing. These include Block’s (NYSE: XYZ) decision to cut 40% of its entire workforce. This totaled 4,000 jobs. Jack Dorsey, CEO of Block, said smaller teams married with AI were extremely efficient.
The Block decision was followed quickly by 21,000 layoffs at Oracle (NASDAQ: ORCL). This was 13% of its 162,000 workers. Some outsiders were skeptical about the decision because Oracle’s expenses are viewed in light of its huge investments in AI, which have been a trigger for a sell-off in its shares. Amazon (NASDAQ: AMZN) and Meta (NASDAQ: META) have also downsized parts of their operations because of AI, according to their management.
The question about this growing number of job cuts is whether they are an early part of what will become an AI-created “unemployment apocalypse.” This would involve software engineers, people in entry-level jobs that involve data analysis and recommendations for the analysis. The data analyst challenge is based on whether AI is faster and more accurate at producing results. It could move across consulting and the financial services industry.
The largest number of AI-driven layoffs may eventually be among companies that have front-line workers. Many of these are retailers from McDonald’s to Walmart. Taken together across some of America’s largest employers, cuts could go, in aggregate, into the hundreds of thousands.
When the Titanic hit the iceberg that sank it, the first reaction was that it was “unsinkable.” Is Uber part of the tip of that iceberg or the 90% beneath the surface?
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Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.
McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.
His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.
A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.
TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.
McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.
