If you have been studying anything about machine learning, robotics and artificial intelligence, you would have to be on another planet if you didn’t think these megatrends were not going to impact the job market. The machines are coming for your jobs. At least some of them. Most large companies in 2024 are using large parts of their IT-spending budgets at A.I. and generative A.I. While some companies are already using A.I. quite well, many companies are just trying to figure out how to actually use A.I. to boost their business or to improve productivity and margins.
Please note that if you are an IT worker who feel like your job is redundant, or if you feel you can be outsourced or replaced, or even if you feel out of place at work, then you better pay attention here. We now have the AI-layoff blueprint from Intuit Inc. (NASDAQ: INTU). Whether or not other companies follow this path it is up to them. Or maybe they can ask their own AI to spell out AI-related layoffs in a way that would have generated a more positive response.
Intuit is slashing 10% of its entire workforce. That’s about 1,800 careers that will suddenly vanish, sort of. The company issued a partial apology letter, but the reality is that this could easily become the handbook or blueprint going forward used by other companies if this works. Intuit even tries to say that, in context of these actions, its headcount will actually grow in Fiscal Year 2025 and beyond. Intuit also claims that it doesn’t do layoffs to cut costs and that’s true in this case.
So is Intuit culling the so-called “dead weight” from its ranks? Or is Intuit really making itself that much more efficient and more nimble? The answer will not be known for a while, but the initial reaction by investors may show more concern than cheer. Intuit’s stock was down 3% at $630.00 on the heels of the announcement.
The SEC filing which shows the memo to all employees was titled “Investing in our future.” It should have added “without you!” The memo starts out spelling out how management sees its duties and obligations for shareholders and for future existence. It says:
As I’ve shared many times, the era of AI is one of the most significant technology shifts of our lifetime. This is truly an extraordinary time – AI is igniting global innovation at an incredible pace, transforming every industry and company in ways that were unimaginable just a few years ago. Companies that aren’t prepared to take advantage of this AI revolution will fall behind and, over time, will no longer exist.
Intuit is at a critical moment in our history…
Laying off 1-in-10 workers might not sound like much. It has happened at many companies. But this announcement just feels different. Intuit says it was early in the push for AI. Now it’s going a step further with the start of the AI revolution —
With the introduction of GenAI, we are now delivering even more compelling customer experiences, increasing monetization potential, and driving efficiencies in how the work gets done within Intuit. But it’s just the beginning of the AI revolution.
The 1,800 people’s roles are either no longer going to be needed or the employees in those roles being cut are not the right fit for Intuit. The tax-software leader even outlines that it plans to hire approximately 1,800 new people, and points to engineering, product, and customer facing roles like sales, customer success, and marketing.
Intuit specified that approximately 1,050 employees leaving the company were not meeting expectations and who “will be more successful outside of Intuit.” The company also said it will lower executives, at the “director and above” level) by about 10%, consolidating 80 technology roles, will close two sites (Edmonton and Boise, for over 250 employees), and it is eliminating over 300 roles across the company.
Some employees may find the exit packages generous. If this follows the path of other large layoffs, then other employees will feel that they have limited opportunities. The package states a minimum of 16-weeks pay and 6-months of health coverage, plus an additional two-weeks per year with the company. And the last day will not occur for another 60 days from this date.
Intuit’s management team might have expected a stronger reception to its plans before it made the announcement. Maybe the machines told management how best to break the news. This was certainly not the first AI-related targeted layoff effort by a large company. That said, this may be a blueprint going forward — if the company is successful in its transition.
