Some Companies Link AI to Job Cuts, but the Reality is More Complex

When Amazon announced it was cutting 16,000 corporate jobs, many assumed it was part of CEO Andy Jassy's strategy to reduce the workforce as AI brings efficiency gains. N. Lee Plumb, who led AI enablement at Amazon, was among those laid off despite being a top user of the company's AI coding tool. This raises questions about whether AI is genuinely driving these layoffs or if companies are using it as a narrative to appease investors.

Credit: AMAZON

Plumb noted that while many believed the layoffs were due to AI, Amazon stated that AI was not the primary reason for most of the job cuts. The company explained that the changes aimed to strengthen its culture and reduce bureaucracy. This sentiment is echoed by other companies like Pinterest and Dow, which have also linked workforce reductions to AI initiatives. However, the actual impact of AI on job cuts remains ambiguous.

Economists like Karan Girotra from Cornell University express skepticism about the direct correlation between AI and layoffs. They argue that while AI can enhance productivity, it often takes time for companies to adjust their management structures accordingly. The gains from AI typically benefit individual employees rather than the organisation as a whole, making it difficult to ascertain the true impact of AI on job security.

Goldman Sachs has reported that the overall effect of AI on the labour market is still limited, although specific sectors like marketing and customer service may feel its impact more acutely. The report indicated that very few employees had been affected by layoffs attributed to AI, prior to the announcements from Amazon, Dow, and Pinterest.

Credit: PINTEREST

Pinterest has been explicit in stating that its layoffs were driven by a shift towards an AI-focused strategy, reallocating resources to roles that support AI adoption. Similarly, Expedia has made cuts that included AI-specific positions, while Dow has linked its layoffs to plans for increased productivity through AI and automation.

Amazon's job cuts are part of a broader trend, with over 30,000 positions eliminated since Jassy's push for AI-driven changes began. This includes a significant reduction in retail workers as the company closes several Amazon Go and Fresh stores. The narrative surrounding AI and job cuts is complex, with companies often using AI as a justification for workforce reductions while simultaneously pushing for greater efficiency.

Meta's CEO Mark Zuckerberg has also indicated that AI will dramatically change work processes, suggesting that tasks previously requiring large teams could now be accomplished by fewer individuals. However, the reality of these changes is still unfolding, and the implications for job security remain uncertain.

Plumb, now running for Congress, reflects a growing concern among workers about the tech industry's reliance on AI and its potential to replace human jobs. He argues that the narrative surrounding AI-driven layoffs may be more about corporate strategy than actual workforce needs. As companies continue to navigate the integration of AI, the true impact on employment will likely remain a contentious topic.

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• Amazon's layoffs of 16,000 jobs are linked to efficiency gains from AI, but the actual impact of AI on job cuts is unclear.

• Economists express skepticism about the direct correlation between AI and layoffs, suggesting that productivity gains often benefit individual employees rather than the organisation.

• Companies like Pinterest and Dow have explicitly tied workforce reductions to AI initiatives, while Amazon claims AI was not the primary reason for most cuts.

Source: AP NEWS

SpaceX Acquires xAI in Record Deal, Unifying Musk’s AI and Space Ventures

SpaceX has acquired artificial-intelligence startup xAI in a record-setting deal, announced by Chairman Elon Musk. This move unifies Mr Musk’s artificial intelligence and space ambitions, combining the rocket-and-satellite company with the maker of the Grok chatbot.

Credit: SpaceX

The transaction represents one of the most ambitious technology sector tie-ups yet, bringing together a space-and-defence contractor with a fast-growing AI developer. XAI’s operational costs are largely driven by chips, data centres, and energy consumption.

The acquisition could also bolster SpaceX’s data-centre ambitions. Chairman Musk competes with rivals such as Alphabet’s Google, Meta, Amazon-backed Anthropic, and OpenAI in the artificial intelligence sector.

A person familiar with the matter stated the transaction values SpaceX at $1 trillion and xAI at $250 billion. This acquisition marks a new record for the world’s largest merger and acquisition deal.

The previous record, held for more than 25 years, was when Vodafone acquired Germany’s Mannesmann in 2000 for $203 billion, according to data compiled by LSEG.

Chairman Musk commented, "This marks not just the next chapter, but the next book in SpaceX and xAI's mission: scaling to make a sentient sun to understand the Universe and extend the light of consciousness to the stars!"

Another person familiar with the matter indicated that the combined company of SpaceX and xAI is expected to price shares at about $527 each. SpaceX was already the world’s most valuable privately held company.

Credit: SpaceX

SpaceX was last valued at $800 billion in a recent insider share sale. XAI was last valued at $230 billion in November, according to the Wall Street Journal.

The merger comes as the space company plans a blockbuster public offering that could value it at over $1.5 trillion. Two people familiar with the matter shared this information.

The deal further consolidates Chairman Musk’s business empire and fortunes into a tighter, mutually reinforcing ecosystem. This structure is informally known by some investors and analysts as the "Muskonomy."

His other ventures include electric vehicle maker Tesla, brain-chip manufacturer Neuralink, and tunnel firm The Boring Company. Chairman Musk has a history of merging his ventures together.

He folded social media platform X into xAI through a share swap last year, giving the artificial intelligence startup access to the platform’s data and distribution.

In 2016, Mr Musk used Tesla’s stock to acquire his solar-energy company SolarCity.

The agreement could attract scrutiny from regulators and investors regarding governance, valuation, and potential conflicts of interest. This concern arises given Chairman Musk’s overlapping leadership roles across multiple firms.

Potential movement of engineers, proprietary technology, and contracts between entities also raises questions. SpaceX holds billions of dollars in federal contracts with NASA, the Department of Defence, and intelligence agencies.

These organisations all possess some authority to review merger and acquisition transactions for national security and other risks.

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• SpaceX has acquired artificial-intelligence startup xAI in a record-setting merger and acquisition deal.

• The acquisition unifies Chairman Elon Musk’s artificial intelligence and space ambitions, integrating the rocket-and-satellite company with the Grok chatbot maker.

• SpaceX is valued at SGD 1.35 trillion, and xAI at SGD 337.5 billion, setting a new global record for M&A transactions.

Source: REUTERS

Crawling Robotic Hand Boosts Object Handling, Access

Scientists have developed a detachable robotic hand capable of crawling and grasping objects, a design that could enhance capabilities in industrial, service, and exploratory robotics. This innovation enables tasks such as retrieving objects beyond normal reach and performing multi-object handling.

Credit: Xiao Gao

The research detailing this technology was published in the journal *Nature Communications*. Robotic hands often aim to replicate the human hand's dexterity but face limitations, including asymmetric structure and restricted reach.

These limitations can hinder tasks like grasping multiple objects simultaneously or accessing confined spaces. The new design addresses these challenges with a symmetrical structure.

Researcher Xiao Gao and colleagues presented two versions of the robotic hand, one with five fingers and another with six. Each hand features a palm 16 cm in diameter, allowing grasping from both sides.

The hand can also detach from its arm-mounted base to crawl independently. This mobility enables it to retrieve up to three objects sequentially and reattach while maintaining a secure grasp on the objects.

The device securely holds various everyday items, including a cardboard tube, a rubber ball, a whiteboard marker, and a tin can. It can replicate 33 human grasp types and hold objects weighing up to two kilograms.

Future research may explore specific applications for this technology, particularly in accessing and performing tasks within confined spaces.

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• Detachable robotic hand can crawl and grasp objects.

• Design allows symmetrical grasping and multi-object handling.

• Capable of retrieving up to three objects sequentially.

Source: TECHXPLORE