MS offers voluntary retirement to 60,000 people... Large-scale facility investment and human resource adjustment, Meta reassigns employees to AI work, Salesforce automates customer consultation
Big tech companies in the U.S. are increasing their investments in artificial intelligence (AI) while simultaneously reducing their existing workforce. Although enormous amounts of money are invested in data centers and semiconductors, there are successive cases of downsizing or moving manpower to other departments in customer support and management tasks.
Microsoft (MS) proposed voluntary retirement to 27% of all employees, and Meta reallocated its existing workforce to AI-related work. Salesforce reduced its customer support organization after introducing AI consulting services. AI competition is changing not only companies' investments but also the jobs employees do.
#### MS investing $175 billion, voluntary retirement for 60,000 employees
According to Reuters and the Financial Times (FT) on the 26th (local time), Microsoft proposed voluntary retirement to about 60,000 employees in some organizations in the United States, United Kingdom, Canada, and India. This corresponds to approximately 27% of the total 223,000 employees as of the end of June. The actual number of retirees has not yet been confirmed.
Targets included organizations related to Windows, Xbox, and Co-Pilot, as well as finance and human resources departments. Some organizations, such as security, marketing, and data centers, were excluded.
Microsoft forecast this year's capital expenditures to be $175 billion. As investments in AI data centers and semiconductors increased, free cash flow in the most recent quarter amounted to $19.6 billion, down 23% from the same period last year.
MS stated that this voluntary retirement is not a measure to directly cover AI investment costs. Chief People Officer Amy Coleman explained in a memo to employees that the decision was made in response to changing workforce needs.
Amazon also announced a layoff of about 30,000 office workers twice, in October of last year and January of this year. Last July, the general artificial intelligence (AGI) research organization also reduced some staff. In the AI development sector, personnel adjustments are also being made according to business priorities.
#### AI takes charge of customer service, employees move to new tasks
Last May, Meta laid off about 10% of its total employees and separately converted 7,000 people to new AI-related jobs. We reduced existing management positions and strengthened AI agent development and work automation organizations.
According to an internal document obtained by Reuters, Meta moved existing employees to an organization responsible for AI agent development and productivity analysis. This is a measure to utilize AI not only in service development but also in-house work.
Salesforce reduced its customer support staff from about 9,000 to 5,000. CEO Marc Benioff said in a podcast interview last year that the number of customer support personnel needed has decreased since the introduction of the AI consulting service 'Agent Force'.
According to Salesforce, Agent Force handled 2.6 million customer conversations and had an inquiry resolution rate of 63%. The company reassigned hundreds of existing employees to sales and professional services while simultaneously reducing natural attrition and reducing new hires.
Oracle also had 141,000 employees at the end of May this year, a decrease of 21,000 from the previous year. The company presented the introduction of AI, changes in business strategy, and organizational reorganization as the background for personnel adjustments.
Big Tech's job cuts were also influenced by increased organizational efficiency and business reorganization during the pandemic. However, there are also cases, such as Salesforce, where the demand for manpower in existing tasks is reduced due to the introduction of AI.
The formula by which expanded AI investment leads to increased employment is also changing. Companies are automating repetitive tasks while focusing manpower on AI development and core technology areas. Competition from big tech goes beyond the scale of investment and is changing the role of the workforce and job composition.
