DBS Group, a major global banking institution, has announced plans to reduce its workforce by 10% over the next three years. This means that around 4,000 jobs will be cut as artificial intelligence (AI) becomes a bigger part of the bank’s operations. The announcement was made by the bank’s Chief Executive Officer, Piyush Gupta, at an event organized by the Indian IT industry group, Nasscom.
AI’s Impact on Jobs at DBS
Mr. Gupta emphasized that AI is unlike any other technology the bank has used before. He admitted that, for the first time in his 15-year leadership at DBS, he is finding it difficult to create new job opportunities. He described AI as a “powerful and different” technology that can self-create and mimic human actions.
According to Mr. Gupta, DBS has not experienced significant job cuts in the last decade. Even during its digital transformation in 2016-17, when 1,600 jobs were at risk, the bank managed to repurpose almost all affected employees in consultation with unions. However, with AI now automating many processes, repurposing jobs has become a challenge.
Who Will Be Affected?
In a statement, DBS clarified that most of the 4,000 job reductions will involve temporary and contract staff rather than permanent employees. The bank also mentioned that some of the workforce reduction will happen through natural attrition, meaning positions will not be filled when employees leave.
DBS’s AI Strategy
DBS has been using AI across different areas of its business, including customer outreach, credit underwriting, and hiring. However, the bank is cautious about relying entirely on AI, especially for customer interactions, due to concerns such as AI-generated errors, also known as “hallucinations.”
The bank first experimented with AI in 2012-13 but did not see much success. However, it started using generative AI solutions two years ago, and Mr. Gupta believes the full benefits of AI are yet to be realized. The bank has already implemented AI-driven customer outreach on a small scale and plans to expand it by the end of the year.
As DBS continues to integrate AI into its operations, it remains to be seen how the workforce adapts to these changes and what new opportunities may arise in the banking industry.
