It’s also a lie. LLMs can’t replace a single worker, and most CEOs know that, they are using it as an excuse to cover up the consequences of mismanagement and/or increase short term profits at the expense of future growth.
Saying you’re doing layoffs lowers stock price. Saying you’re replacing workers and stocks might even go up. It’s a pretty big incentive if your pay package depends on the stock price.
I don’t think that’s true, it’s just not how the execs are seeing it.
If you have 100 staff using AI within the means of what it can actually do, you might not need the whole 100 staff. Maybe you only need 98 now to get the same outcome, or whatever it is.
What it can’t do is replace a whole job category. You can’t replace all your customer service with it, or all your developers or all your marketing team. You still need those people, but if you employ enough people in a category, eventually it could reduce how many you need, which is essentially replacing them.
Not just 20 extra people. I’m seeing a funny trend in my company where managers decide to get into vibe coding and they get super excited at getting something somewhat functional running, so now they’ve been presenting “their work” and expecting developers to merge their heaping trash in. That’ll require quite a few more people.
This is the real problem thats leading to them thinking they can fire so many people. They get all excited because it can sometimes do something (and possibly do it terribly behind the scenes, but still do it) and oh shit we don’t need any humans anymore!
Then you get companies regretting laying people off. The wrong people are making the decisions without understanding what is happening.
It’s also a lie. LLMs can’t replace a single worker, and most CEOs know that, they are using it as an excuse to cover up the consequences of mismanagement and/or increase short term profits at the expense of future growth.
Saying you’re doing layoffs lowers stock price. Saying you’re replacing workers and stocks might even go up. It’s a pretty big incentive if your pay package depends on the stock price.
What is this magical place where saying you do layoffs lowers the stock price. I’d like to go there.
I don’t think that’s true, it’s just not how the execs are seeing it.
If you have 100 staff using AI within the means of what it can actually do, you might not need the whole 100 staff. Maybe you only need 98 now to get the same outcome, or whatever it is.
What it can’t do is replace a whole job category. You can’t replace all your customer service with it, or all your developers or all your marketing team. You still need those people, but if you employ enough people in a category, eventually it could reduce how many you need, which is essentially replacing them.
You’d be surprised…
An AI hype company did a fairly ok study with programmers. Some used ai some didn’t and they compared the difference in completion time.
The AI users were 20% slower than the non AI users, but thought they were faster.
So for your scenario, the company would need to hire 20 extra people to make up for the lost productivity.
Not just 20 extra people. I’m seeing a funny trend in my company where managers decide to get into vibe coding and they get super excited at getting something somewhat functional running, so now they’ve been presenting “their work” and expecting developers to merge their heaping trash in. That’ll require quite a few more people.
This is the real problem thats leading to them thinking they can fire so many people. They get all excited because it can sometimes do something (and possibly do it terribly behind the scenes, but still do it) and oh shit we don’t need any humans anymore!
Then you get companies regretting laying people off. The wrong people are making the decisions without understanding what is happening.