According to George Kailas, CEO of fintech startup Prospero.Ai, there might have to be a new term for the series of jobs that AI will replace.
Writing for Fast Company, Kailas said that quiet quitting gained momentum during COVID, when employees would do the bare minimum at work to either collect an easy paycheck or be fired with severance. However, Kailas noted that the opposite might gain momentum soon as silent firings become a new workplace trend. Silent firing is where firms make jobs harder, hoping employees will quit and their positions can be automated.
AI spending has the markings of capital expenditure, which are high upfront costs, return-on-investment (ROI) to be realized over the longer term and following the spirit of Moore’s Law, which is that any assets you create will rapidly depreciate. Kailas said that from his experience on the hedge fund buy side, these factors make reducing headcount inevitable. Firms will need to show ROI on these AI investments. Unfortunately, if one views it through an ROI lens, this means job replacement.
This is not just a theory, though. If you think of a large company that has been preparing for automation more than any other, you would put Amazon or perhaps Tesla at the top of the list. Amazon has pushed a five-day in-office workweek, even though 90% of their employees are “dissatisfied” and 73% are quitting. Did one of the most innovative data-driven firms forget how to use data?
Big Tech hiring has started to climb again after 13 months of historically low hiring rates, Kailas said. Then, in May, arrivals started to outpace departures. However, the data come with a caveat. After growing headcount by over 5% in 2022, the Big Tech firms have given up all of that growth and more in the past 18 months, based on data from Live Data Technologies. Additionally, Big Tech headcount is still below Jan.1, 2022 levels. About 18% of people who left a Big Tech firm in the past year are still professionally unemployed.
The bottom line is that outside of AI and the hottest early-stage startups, tech hiring is slow to nonexistent, even for applicants that come from top tech firms.
These stories make things abundantly clear: While AI is booming, the rest of the labor market is stagnant or dipping based on unemployment numbers. What makes this even worse is that the surface of the AI adoption curve has yet to be seen, Kailas wrote.