IBM and artificial intelligence: From the planned job cuts to unexpected growth

Published on: May 17, 2025 / update from: May 17, 2025 - Author: Konrad Wolfenstein

IBM and artificial intelligence: From the planned job cuts to unexpected growth - picture: Xpert.digital

Two -edge sword: IBM and the future of artificial intelligence

Artificial intelligence at IBM: winner and loser of a transformation

The history of artificial intelligence at IBM shows an example of how technological transformations often take unexpected turns. What began as an announcement of a massive job removal developed into an example of the complex and complex effects of the AI on the world of work - a double -edged sword with winners and losers.

Suitable for:

A little insight into our work: Business Development and Marketing with AI - Our AIS - R&D - Xpaper (beta) tools

The original announcement: 7,800 jobs in danger

In May 2023, IBM CEO Arvind Krishna made headlines with a remarkable announcement: The company would impose a stop for certain administrative professions and plan to replace around 30 percent of its back office positions with artificial intelligence within five years. In a total of 26,000 affected jobs, Krishna specifically spoke of around 7,800 jobs that could be eliminated by AI and automation.

Departments without direct customer contact were particularly affected, especially the HR department. The strategy provided that there - for example by retirement - no longer recovered to avoid operating dismissals. Krishna explained that routine tasks in particular should be automated, for example parts of the mail traffic in the event of attitudes or the management of employee releases between departments. However, more complex tasks such as employee reviews should continue to be carried out by humans.

This announcement fell into a time when generative AI systems such as Chatgpt caused enormous sensation and many employees feared their professional future. IBM seemed to lead the wave of AI-related restructuring.

The surprising development: fewer layoffs, more overall growth

Two years later, in May 2025, Krishna presented a surprising result: Instead of the announced 7,800 jobs, only “a few hundred” employees in the HR area were replaced by AI. Even more remarkable: the overall employment at IBM has not decreased, but increased.

While IBM has invested a lot of work in the use of AI and the automation of certain corporate processes, the company's total number of employees, according to Krishna, has nevertheless increased to Wall Street Journal, as this enables more investments in other areas. The IBM annual report 2024 shows that the company employs 270,300 people worldwide-a significant increase compared to the 260,000 employees in 2023.

The AI use did not lead to a shrinkage of the company, but to redistribution of resources and a realignment of the personnel strategy.

AI implementation at IBM: Askhr and Askit

IBMS Ki transformation began in 2016 with the introduction of first chatbots and continued with the first live system in 2017. The current platform “Askhr” forms the heart of this development. This “digital HR manager” not only takes on advisory functions, but also performs complex processes fully automatically. For example, the transfer of an employee in the dialogue between a manager and the bot can be done without any manual activity of a human personnel.

According to IBMS CTO Ji-Eun Lee, ASKHR has now automated 94 percent of simple, routine personnel tasks, including vacation applications and pay slips. A similar system called “Askit” has reduced the number of calls and chats for the IT department by 70 percent.

These increases in efficiency have also become financially noticeable: IBM reports of an “productivity increase” worth 3.5 billion US dollars over the past two years by using AI in more than 70 business areas.

The double-edged sword: winner and loser of the AI transformation

The development at IBM clearly shows the ambivalent character of the AI transformation. On the one hand, several hundred employees in the HR area have lost their jobs-for them personally, the AI revolution was no reason to be happy. On the other hand, the company has invested the freedom resources in other areas and created new jobs, especially for “critical thinking” and interpersonal interactions.

IBM used the resources released by AI to hire more programmers, marketing experts and sales employees. Krishna emphasized that these areas require “critical thinking” and include “dealing with other people” - in contrast to “pure process work”. This shift illustrates a fundamental change in the world of work: routine tasks are increasingly automated, while complex, creative and social activities are becoming more important.

The IBM experience shows that AI eliminates certain jobs, but at the same time creates new ones. However, these new bodies often require different qualifications and skills than the eliminating positions. This presents employees with the challenge of continuously training and adapting.

Suitable for:

Fear and uncertainty in the world of work – 70% overwhelmed: AI, hybrid working models, home office and professional backlog

Strategies for employees and companies in times of AI transformation

IBM history offers important teachings for employees and companies alike. In an interview with “Sunday Times”, Krishna herself advised to rely on critical thinking skills: “Psychology, engineering, history - you learn all of this there.” These skills enable people to adapt to changed and unpredictable circumstances.

For companies, the IBM example shows that a strategic approach to AI implementation can enable both productivity increases and growth. IBM did not primarily consider the AI as a tool for cutting costs, but as a means of redistribution of resources into more value -added areas.

Madeleine Bauer-Eder, Chro at IBM Austria, emphasizes that it is crucial to consider AI as a supplement to human work and not as a replacement. The cooperative approach, in which people and machine work together instead of against each other, could be the key to successfully designed the AI revolution.

AI as a transformer instead of destroyers

The history of IBMS AI transformation illustrates that the effects of artificial intelligence on the labor market are more complex than initially assumed. Instead of the feared mass unemployment, we observe a redesign of the world of work with both winners and losers.

While a few hundred IBM employees lost their positions in the HR area, the company has created more jobs than dismantled. For IBM, the AI has not proven to be a pure cost reduction instrument, but as a catalyst for a strategic realignment of the workforce towards higher -quality activities.

This development underlines that AI is actually a double -edged sword - with risks for certain professional groups, but also with considerable opportunities for companies and employees who can face the new requirements. The central challenge is to use the resources released by AI and to enable employees to transition into new, future -proof fields of activity.

Suitable for: