Salesforce Announces Job Cuts in Ireland as AI Adoption Grows

The American software company Salesforce is set to implement a new round of job cuts in its Irish operations, marking the second such reduction this year. This decision comes as the company increasingly turns to artificial intelligence (AI) to automate various roles. The firm, which operates out of its offices on North Wall in Dublin and employs over 2,500 people, has informed the Department of Enterprise of its plans to reduce staff numbers.

On September 2, 2023, a government spokesperson confirmed that the department received notification of proposed collective redundancies from SFDC Ireland Limited. For companies with a workforce exceeding 300, it is mandatory to notify the department if they plan to cut at least 30 jobs. When asked about the exact number of positions affected, a Salesforce spokesperson indicated, “We continuously assess our structure and rebalance as needed to best serve our customers and fuel growth areas.”

Industry sources suggest that the planned job losses may range between 50 and 60, mirroring a similar number of redundancies earlier this year. In total, Salesforce has eliminated approximately 200 jobs in Ireland during 2023, a year marked by a general downturn in the technology sector.

In a podcast interview last week, Marc Benioff, the company’s chief executive, revealed that Salesforce has streamlined its workforce in support roles, reducing the number from 9,000 to 5,000 as a result of the integration of AI agents. These AI systems are capable of performing tasks independently, such as responding to customer inquiries regarding pricing and generating marketing materials. According to Benioff, AI now accounts for between 30% and 50% of the company’s overall workload.

Salesforce employs around 70,000 people globally. The Dublin hub, established in 2000, relocated to the Salesforce Tower in the North Docklands two years ago. Following the announcement of its job cuts, Salesforce’s share price experienced a decline of up to 8%. This drop was prompted by the company’s third-quarter revenue forecast, which indicated that returns from AI investments may not materialize as quickly as anticipated.

The substantial investment in AI-driven cloud technologies is placing increasing pressure on these companies to demonstrate financial returns. Investors are also expressing concerns that established players in the tech sector could be at risk of being outpaced by emerging AI start-ups. According to Matt Britzman, a senior equity analyst at Hargreaves Lansdown, the current outlook provides sceptics with new arguments, particularly as fears grow about the potential for disruption within the software industry and the ability of incumbents to fully monetize AI advancements.

As Salesforce navigates this transition towards greater automation, the implications for its workforce and the broader tech landscape remain to be seen.