Major reductions at GM
Detroit’s largest automaker is again cutting its technology workforce, this time specifically targeting people who build and maintain its software. Between 500 and 600 GM information technology employees are losing their jobs, according to sources familiar with the matter who spoke with Bloomberg, as the company restructures its IT operations and plans to hire workers with different technology skills.
Details of the layoffs
Employees began receiving layoff notices early this week. Most of the positions affected are tied to GM facilities in Austin, Texas, and Warren, Michigan, but some roles are also being eliminated in global offices.
It is worth noting that GM is still hiring in IT: the company’s careers website lists 78 open positions, including roles in artificial intelligence, motorsports, and autonomous vehicles.
Reasons for restructuring
According to Bloomberg, GM is restructuring its IT operations, increasingly relying on artificial intelligence and equipping its vehicles with more computing power and software capabilities. The company says this move will better prepare it for the future.
“GM is transforming its information technology organization to better position the company for the future,” the company said in a statement. “As part of this work, we have made the difficult decision to eliminate certain roles around the world. We are grateful for the contributions of the affected employees and are committed to supporting them through this transition.”
Scale and context
As of the end of last year, GM had approximately 47,000 white-collar workers in the U.S., and while the number of cuts is relatively small compared to the total workforce, these layoffs are still notable. They also come just a few months after approximately 500 workers at GM’s plant in Oshawa, Canada, lost their jobs due to a decision to cut the third shift at that facility and move truck production to the Fort Wayne, Indiana plant.
Job losses related to the implementation of new technologies may not stop there. GM CEO Mary Barra recently revealed that nearly 90 percent of the code used by the company’s autonomous driving technologies is generated by artificial intelligence.
This situation demonstrates a difficult transitional period for major automakers trying to balance the need to cut costs with investing in future technologies. While GM claims to be creating new jobs in AI and autonomous vehicles, the number of these vacancies is significantly smaller than the number of positions cut. This suggests that automation and artificial intelligence are not just changing the nature of work, but are also leading to a net reduction in jobs in traditional IT departments. Given that nearly all the code for autonomous technologies is already being created by AI, it can be expected that similar restructurings will become the norm for the entire automotive industry, which seeks to remain competitive in the era of electrification and software-defined vehicles.