The Impact of AI on the Tech Job Market

If there’s a common word on everyone’s daily internet feed right now, that would be AI—artificial intelligence. As an innovation that promises to change how we live, it’s not surprising to see so much hype around it.

But beyond the hype, AI has successfully proven to be a major influence in the job market. And the tech industry is at the forefront of this influence, given that AI revolves around technology in the first place.

Now, the question is, how much impact will these intelligent Tech Forms have on the tech job market, and will the impact be negative or positive?

Let’s get down to it in this article.

Less Input, Improved Work Productivity For Tech Companies

“Getting a proportionate result for the effort you’ve put in is called productivity. But when it comes to the technological industry, that’s simply not good enough, thanks to the demand pressure on your business output and the existing competitive floor”, says Jeffrey Zhou, CEO and Founder of Fig Loans.

So, your output has to be greater than the effort you put in, a concept that means doing little to achieve more results. And that’s only possible by addressing some of the factors that strain your productivity in the first place. For example, repetitive tasks.

In a report by SimplyFlows, employees waste 40% of their working time on repetitive tasks. A perfect example of this in a typical tech industry includes manually checking for code bugs, inputting data from spreadsheets into the system database, labeling and tagging data for machine learning, and so on.

So, if we eliminate these tasks, productivity should shoot up, and revenue should follow suit. However, elimination of such tasks is only on the basis that they do not make up the bulk of your core operations—which we can bet does. 

Fortunately, AI-powered software programs save the day by helping you handle them all—talk about automatic migration of data from sheets to online databases in seconds, sleek and constant check for code bugs and errors, and handling routine customer queries through conversational chatbots.

“For tech businesses that are already so busy with the ‘techie assignments’ on their desks, using AI as a virtual assistant provides a lot of relief. This allows your workers to focus on the more crucial tasks. As a result, there’s increased productivity despite doing much less than before,” Jonathan Feniak, General Counsel at LLC Attorney, says.

However, this positive influence has an implication—if AI can do it, then why still hire humans?

Potential Job Displacement: AI in, Humans Out

Sergey Taver, Marketing Manager at Precision Watches,  a company specializing in pre-owned Rolex watches since 1946, says, “AI handling repetitive tasks means businesses can now save cost by simply cutting their workforce in half, or maybe more. Well, at least, that’s what’s happening right now. AI is gradually becoming the most sought-after ideal worker.”

Just seven months into 2024, about 108,591 employees had already lost their jobs. 

In January, about 122 tech companies cut a total of 34,107 jobs, resulting in thousands of role displacements and a frenzy in search of newer job openings. This was followed by 15,589 tech layoffs in February by approximately 78 companies and a lesser figure of 7,403 in March by 37 tech organizations.

Mid-year months and the closer ones like April have since seen more than 21,473 job losses from about 50 companies in 2024. As of the time of writing this article, there’s no data on job losses for June and July, but one thing is sure: they’ll number in the tens of thousands.

While this is still a far cry from the 263,180 layoffs in 2023, we might be getting closer as 2024 ends, probably by the time you read this article.

Perhaps these cuts are not as a result of AI integration?

Well, we assure you over 70% are. However, some tech companies take the silent approach instead of announcing AI as a reason for their layoffs.

On the other end, some companies take a more open approach. For instance, Suumit Shah, the CEO of Dukaan, announced in 2023 that he had replaced 90% of his customer support employees with a chatbot named Lina. He enjoyed the euphoria for a moment before social fans and laid-off workers retorted with some hard-hitting comments. Of course, that didn’t really solve anything.

Obviously, Suumit is not the only one who has laid off a massive chunk of his organizational team so far. Moreover, the layoffs are not likely to end anytime soon. About 44% of companies using or planning to use AI already project, cutting off 21% to 23% of their workforce.

Worse still, Nvidia’s CEO, Jensen Huang, boldly proclaimed that AI would take over coding and everything related to programming in the years to come.

“Over the last 10-15 years, almost everybody who sits on a stage like this would tell you that it is vital that your children learn computer science, everybody should learn how to program. In fact, it is almost exactly the opposite. It is our job to create computing technology such that nobody has to program, and that the programming language is human. Everybody in the world is now a programmer. This is the miracle of AI,” — Jensen Huang.

The existence of No Code/Low Code platforms proves him right to some extent.

But then, is this the death of the job market for human techies? 

Not really. We just have to do better than these bots while acknowledging their roles in helping us become better. We created them, after all.

Shift From Routine Task-Oriented Jobs To More Creative And Strategic Roles

OpenAI’s Chief Technology Officer, Mira Murati, broke the shell with a glib comment and bluntly said, “Some creative jobs maybe will go away, but maybe they shouldn't have been there in the first place.”

That’s ridiculously insensitive, coming at a time when layoffs were at an all-time high in the year. Sam Altman has not shied away from making similar comments in recent months as well, with much emphasis on how “jobs are definitely going to go away, full stop.” But they are still far off from Murati’s outright declaration against automatable roles.

While we don’t entirely agree with her, either way, there’s an iota of reality in the point she made. Some basic jobs will really bear the burden of a disruptive influence. 

The UK's Institute for Public Policy Research backed this up with a report on an incoming job apocalypse for entry-level roles, administrative duties, and other part-time tasks.

According to Kyran Schmidt, Cofounder at Outverse, “Customer support and other front desk jobs are not exempt from this change either. There are now dozens of super-effective customer support AI agents and chatbots that can effortlessly handle human queries and come up with smart, hyper-personalized responses in seconds, with little to no human assistance.”

But as Murati said, this shift will force us to look out for more resourceful, creative, and strategic roles that AI can’t possibly handle at the moment.

“Of course, this AI-human brawl is not ending anytime soon. AI will always improve to take on complex assignments, thus effectively eliminating human job autonomy. That sounds ridiculous, but it is true. You’re racing to the top with AI on your tail,” adds Bert Hofhuis, Founder of Every Investor.

Creation Of New AI-Tech Jobs

According to Joseph Schumpeter, change is inescapable, and our traditional or old ways of doing things are constantly being superseded by new ones. So, it’s true that AI will bring a disruptive change to the job market, but this change is not without some rewards.

The World Economic Forum pointed this out in 2023, “The adoption of generative AI, particularly LLMs, will transform business and the nature of work, displacing some existing jobs in the process, enhancing others, and ultimately creating many new roles.”

For instance, the AI shift is already spawning newer but well-compensated roles like: 

Newer AI startups are also springing up, creating employment opportunities for fresh college graduates and laid-off workers in the tech industry.

Source: World Economic Forum

AI systems require a tremendous amount of power, a problem that has bugged even Sam Altman and other leading AI voices. However, the World Economic Forum’s (WEF) report shows that this need will propagate the demand for power system engineers.

WEF’s job report also designated AI content creators as sustainers since they need to provide prompts that LLMs depend on. Machine learning specialists are expected to see a 39% increase in global job growth.

A study conducted by McKinsey Global Institute foresees the creation of 20 to 50 million jobs with the help of AI before early 2030. The World Economic Forum foresaw a double of this—97 million jobs before 2025.

While none of these reports are absolute or something to hold with a handful of salt, they at least provide a good assurance that the tech job market is not going away anytime soon.

AI in Tech Recruitment: What’s In It For You?

From the perspective of Leigh McKenzie, Community Advocate at Traffic Think Tank, “Recruitment has always been a big hassle for hiring managers and employers alike, especially when you’re talking about the Tech industry. But that’s changing. Companies are adopting AI-powered recruitment programs to sift through thousands of applications in seconds based on preset filters.”

However, for job seekers, that’s not necessarily good news. These preset filters, which sometimes include specific keywords, determine if a cover letter and resume will make it to the second stage. The bad news is that you can easily omit such keywords by mistake when preparing your documents.

Besides, the current AI programs still fall short of humans when it comes to cognitive reasoning, and this can lead to inaccurate errors, such as disqualifying a potential talent for rigid reasons like incorrectly spelled skillset, even if the experience matches up.

Grant Aldrich, Founder of Preppy, believes “Companies should use AI-powered recruitment programs in combination with a human reviewer to minimize such errors. Job seekers should also do proper research on what keywords and requirements are crucial to their line of expertise or application.”

If you look on the bright side, AI integration in recruitment means faster application processing and quick feedback from hiring managers. This reduces your wait time and helps you focus on other available opportunities.

Adapting To The AI Wave

AI is here to stay, and it’s up to you to ride the wave or not. If you’re doing the former, you need to start by updating your catalog of knowledge on everything AI. Know what AI can do, how much of an influence it has on your work or present skills, and how much help it can offer you.

Albert Kim, VP of Talent at Checkr, says, “Figure out if your role falls within the high-risk automatable category or low-risk. If it’s high-risk, you either need to upskill or learn new AI skills that will upgrade your current role, for instance, data entry to data engineering. Alternatively, you could reskill—acquire new skills to transition into another role, let’s say from data entry to AI trainer.”

Most importantly, you must remain too valuable to be replaced by AI.

At the same time, explore how AI can enhance your productivity even if your role can not be fully automated. For example, a machine learning engineer can employ AI to streamline data pre-processing, feature selection, and hyperparameter tuning while he or she focuses on more complex tasks.

“For new college graduates, entry-level roles are fewer, and internship opportunities are golden but not impossible to get. If you want a good head-start, join tech boot camps, engage in practical assignments, acquire out-of-college experience, and add this to your portfolio. It’ll give you an edge over other applicants when seeking new roles”, Reyansh Mestry, Head of Marketing at TopSource Worldwide, advises.

Wrapping Up

We definitely can’t deny the rapid disruptive change AI has caused to the Tech job market. But it’s a creative destruction—traditional job models die out, and new ones are formed. That’s why you need to be proactive and gain some traction from now.

Stay in touch with every AI trend, from software programs to robotics and every other technological innovation that can impact your job now or in the future. Identify your experience gaps and fill them. 

Determine whether your skills are at high risk of replacement with automation or not. If they are high-risk, then it’s time to upskill or reskill. We offer a range of courses spanning web development, data analytics, and UX/UI design. Choose the one you like and start your upgrade with us today.