IBM’s CEO, Arvind Krishna, has clarified that the wave of layoffs sweeping the technology industry is not primarily driven by artificial intelligence. In a conversation with The Verge, he said the cuts are instead the result of aggressive hiring during the pandemic years, describing the current situation as a “natural correction.” Many companies, he explained, rapidly expanded their workforce between 2020 and 2023, in some cases increasing headcount by more than 30–100 percent. Now that the surge in demand has normalized, businesses are reducing staff to rebalance their operations.
Krishna compared this hiring cycle to an “underdamped system” in engineering, where a company’s need for employees rises sharply during a period of rapid growth, overshoots what is necessary, and eventually must correct itself — sometimes dipping below optimal levels before stabilising again based on real market demand. IBM itself is undergoing this adjustment phase, having announced plans earlier this year to cut thousands of jobs globally as it redirects investment toward areas such as artificial intelligence consulting and software. Although the company did not provide a precise figure, Reuters reported that the layoffs will affect a low single-digit percentage of IBM’s roughly 270,000 employees worldwide.
Addressing the long-term influence of AI on employment, Krishna acknowledged that automation will displace some roles but emphasised that the impact is unlikely to be dramatic. He estimated that AI could eliminate as much as 10 percent of jobs in the United States over the next few years, with the effect concentrated in certain fields rather than spread evenly across the economy. Importantly, he argued that productivity gains from AI will eventually lead companies to expand their workforce again, just not in the same categories of jobs that disappear.
Krishna criticised the mindset among companies that view AI primarily as a tool to reduce entry-level hiring. He called this approach shortsighted and said organisations would benefit more from using AI to elevate junior employees by enhancing their capabilities instead of replacing them. According to him, a business that helps an entry-level worker perform at the level of a seasoned expert has more potential for innovation and future talent development than one that simply eliminates junior positions.
He also stated that IBM’s own hiring strategy reflects this philosophy. Speaking to CNN, Krishna said the company expects to increase recruitment from college campuses in the coming year rather than reduce it. Despite layoffs in some areas, he said IBM plans to hire more young professionals over the next 12 months than in the previous few years, underscoring his belief that AI-driven productivity should result in talent expansion rather than contraction.
