AI is changing the world as we know it. You might have heard that one before. Some version of that refrain has been left on repeat for nearly four years now.
AI as an entity is nothing new. Nor is doomsday scenario planning. Science-fiction writer Isaac Asimov’s infamous three laws of robotics, penned more than 80 years ago, are still occasionally held up as examples of sensible guardrails for inorganic intelligence.
But everything changed when Chat-GPT was widely released in November 2022. We lost our minds when our first prompts, no matter how puerile, returned responses that approximated coherence.
There can be little disputing the power of AI or its potential. Rarely, however, do we ever stop to elaborate on how exactly the world is going to change.
Philosophers call this an ipse dixit ― an assertion that is put forward matter-of-factly without a linking argument. These assumptions have in turn given birth to a distinctly post-postmodernity phrase: “AI-washing”.
It is the idea that AI is slapped to anything regardless of its meaningful contribution. You have likely experienced the idea in items as mundane as your household appliances that overnight became sentient beings capable of complex thought (at least according to the marketing).
But AI-washing has potentially far more nefarious applications than just inflated labels. The number of layoffs attributed to AI internationally has increased exponentially over the past couple of years. Naturally, the scepticism around this justification has risen commensurately.
Fabian Stephany of the Oxford Internet Institute put it to The Guardian this way: “You can say ‘we are integrating the newest technology into our business processes, so we are very much a technological frontrunner, and we have to let go of these people’.”
The suggestion, gaining increasing credence among economists, is that companies are making the cuts they always wanted to under the auspices of AI inevitability. “Technological pioneer” is a far better look than “under-pressure cost-cutter”.
Regardless of how thick your tinfoil hat is, there is no question around the unemployment numbers. Challenger, Gray and Christmas found that 55,000 job cuts in the US were attributed to AI last year.
That number appears to be increasing. Last week the outplacement firm found that a quarter of April’s 88,387 American job cuts were attributed to AI. That trend is reflected in the messaging at some major tech giants. Pinterest axed 15% of its workforce in January, citing an “AI-forward strategy”.
In October Amazon’s Beth Galetti ― with the euphemistic title of senior vice-president of people experience and technology – explained that the technology is “enabling companies to innovate much faster than ever before”. The company laid off 14,000 workers that month before ushering a further 16,000 out of the door at the beginning of the year.
A landmark ruling made international headlines last week out of China ― a country that desires as much as anyone to be at the forefront of this technology. Judges in Hangzhou, the birthplace of DeepSeek, ruled that a fintech company had acted illegally by dismissing an employee and replacing him with a large language model.
After his duties became replicable by AI, “Zhou” had been asked to take a demotion and a pay cut from about $3,680 to $2,205. When he refused, he was let go.
Over the past two years there have been similar rulings in Guangzhou and Beijing in which AI has ostensibly made human employees redundant. But as foundational as the court findings are, it is unlikely to draw a line under the issue.
“The most prudent interpretation of the Hangzhou ruling is not that China has banned AI-related layoffs,” the excellent Spanish newspaper El País wrote. “But rather that it will attempt to prevent automation from being used to circumvent labour obligations and reduce the cost of restructuring.”
It may well portend the particular moment we’re stepping into worldwide. AI agents are rapidly improving as their firms fiercely compete to own as big of a slice of field as possible. There’s no question that they have already and will continue to make innumerable human tasks more efficient.
However, the onus will remain on businesses ― at least those operating under a functional labour law ― to operate ethically and elucidate precise rationales around any operational changes at fintech firms. Platitudes are increasingly going to be interrogated. As are nebulous promises that “the future is AI”.
• Feltham is Business Day editor-in-chief.
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