Will AI Displace Jobs in Australia, or Is It Merely a Rationale for Corporate Restructuring?

Teresa Lim is a prominent voice in Australia, recognized for her contributions to radio and television advertisements over a span of 23 years. Her vocal talents have helped sell a variety of products and services, ranging from baby formula to Test cricket. Yet, despite her extensive experience and a diverse portfolio, she finds herself increasingly anxious about the possibility of being replaced by artificial intelligence (AI).

This concern is not unfounded. In recent months, AI has been linked to over 1,000 job cuts across Australia. Recently, tech giant Atlassian announced a reduction of 500 jobs in Australia as part of a global layoff of 1,600 positions. Experts are predicting that more such layoffs may occur as companies look to leverage technological advancements to reduce costs.

For professionals like Lim, this shift could mean that companies could use AI-generated versions of her voice created from just a short audio clip, thus eliminating the need to hire a real voiceover artist.

“It is terrifying not just for voice actors, but for the general Australian public, because currently we have no legislation in place that makes that illegal,” she states.

In a letter addressed to Atlassian’s staff, CEO Mike Cannon-Brookes clarified that the company’s goal is not to have “AI replace people.” He further added, “but it would be disingenuous to pretend AI doesn’t change the mix of skills we need or the number of roles required in certain areas.”

In a related trend, two weeks prior, Block, the parent company of Afterpay, had laid off 4,000 employees globally, including around 700 in Australia. Wisetech, another local software firm, also cut 2,000 positions.

While some analysts argue that AI is being used as a convenient excuse to justify these job eliminations, an increasing number of employees in various industries are experiencing heightened anxiety about their job security.

Firms such as WiseTech, Block, and Atlassian have slashed jobs in their fundamental software product teams, as they implement AI to increase efficiency among their remaining workforce.

WiseTech’s CEO, Zubin Appoo, clearly made the point that “the era of manually writing code as a core act of engineering is over.”

The employees who were laid off at Block, a company founded by Twitter’s co-founder, Jack Dorsey, raised questions regarding the actual capability of AI to replace their roles. They noted the increasing pressure from investors on the company, especially as Block’s share price dropped by 35% since last October.

The share price of WiseTech had halved in the past six months, while its employee count had doubled following an acquisition. Both experienced a recovery after announcing job cuts, with Block’s shares rising by 20% and WiseTech’s by 11%.

Atlassian, which had its share price drop by 50% within two months, reported a further decline this past Friday.

Telecommunications giant Telstra also cut 200 jobs in its AI joint venture with Accenture. CEO Vicky Brady maintained that no roles were “directly replaced” by AI, though admitted that the technology contributes to overall efficiency.

The Question: Work Revolution or AI-Washing?

Neal Woolrich, an adviser in human resources at Gartner, expresses skepticism about the assertion that job reductions are primarily due to AI.

“Many businesses seem to use AI as a pretext for other internal issues,” he notes. “Economic modeling we conducted last year indicated that only 1% of job cuts were directly attributed to AI productivity improvements.”

“When organizations reduce headcounts, they are often facing other financial pressures that prompt these changes. I suspect there are alternative factors at play.”

Analyst Lochlan Halloway from Morningstar observes that AI technologies can often lead to increased upfront costs despite making organizations more efficient in the long run.

“Companies are eager to promote AI benefits because it’s currently a hot topic, but there’s limited tangible evidence backing these assertions,” he adds.

According to Halloway, firms such as Morningstar have enhanced their use of AI for basic data collection that used to be the responsibility of entry-level analysts. However, he emphasizes, “that doesn’t mean we’re cutting back on our junior positions.”

There’s still a demand for human labor in various sectors. For instance, call centers, which some might assume would be more quickly automated, are still actively hiring human staff, as noted by the recruitment agency Randstad.

While AI technologies may not yet possess the capability to replace human jobs entirely, there remains a widespread anxiety regarding their growing adoption. A study by the Reserve Bank of Australia reveals that nearly one in three Australian businesses are already using AI for advanced tasks, including demand forecasting and inventory management.

Furthermore, survey research conducted by Randstad indicates that about one in three Australians worry that their jobs could vanish due to AI advancements.

In the United States, sectors such as finance, computing, sales, and office administration have already begun hiring fewer entry-level employees, as highlighted by research conducted by Anthropic, the creators of the AI assistant Claude.

Similar trends are emerging in Australia, where companies have reported staff reductions, primarily among junior roles, at rates comparable to those seen overseas.

Although the Australian job market has not yet shown clear signs of significant slowdowns driven by AI, a recent analysis from the National Australia Bank reveals that the unemployment rate among white-collar workers has begun to rise more sharply than that of blue-collar workers, although the latter continues to be higher in overall numbers.

NAB’s senior economist, Taylor Nugent, points out that demand for technical, professional, and managerial positions is softening, though AI does not appear to be the driving force—at least not yet.

“With current technology able to execute a significant portion of tasks required by these roles, the growth in demand may decelerate as fewer workers are necessary to fulfill the same business needs,” Nugent explained back in February.

Undergraduate enrollment in areas such as finance, law, and computer science remains robust. La Trobe University’s vice-chancellor, Prof. Theo Farrell, notes that students are increasingly seeking direction on how to integrate technology into their work.

However, once these graduates enter the job market, they may find conditions more challenging, as recruiters have observed.

Camilla Clarke, managing director at Give a Grad a Go, mentions that smaller firms, especially within consulting and marketing, are hiring fewer junior staff and opting for AI-driven strategies instead. “If they can leverage a tool for a project that would have typically been handled by an intern, this is where I see AI exerting pressure,” she comments.

Alisdair Barr, CEO of job platform Striver, observes that finance graduates are encountering fewer job opportunities within analytics and are increasingly pivoting toward more human-centric roles, such as financial advising.

“They’re asking, ‘how can I leverage my finance degree, and what other options are available to me?’” he notes.

“The roles that seem to be most accessible involve direct human interaction at their core.”