Uber slashes 23% of People team jobs. Is AI the real reason?

Uber is cutting jobs across its human resources and recruitment divisions as part of a broader organisational restructuring, but the company says the move is not linked to artificial intelligence.

The layoffs affect 23 per cent of employees working in the company's People team, which includes HR and recruiting functions. The restructuring is being overseen by Uber president and chief corporate affairs officer Jill Hazelbaker, who took on the expanded role last month, per a report by NDTV.

Why is Uber cutting jobs?

According to Uber CEO Dara Khosrowshahi, the changes are aimed at improving the effectiveness of the department and preparing the company for future growth.

Also Read | Oracle’s AI pivot drives major workforce layoffs despite booming profits

“These changes are necessary to maximise the effectiveness of the People team and the enormous potential ahead of us,” Khosrowshahi said in a memo to company leaders, per NDTV report.

Hazelbaker also addressed employees impacted by the restructuring, saying the company wants to create a more streamlined organisation. In her note, she said the layoffs are intended to build a “more connected, modern, operationally excellent organisation”.

Is AI behind the layoffs?

As several technology companies continue to reshape their workforce around artificial intelligence, questions quickly emerged about whether AI played a role in Uber's decision.

However, the company has denied that the cuts are related to AI adoption. Uber has maintained that the restructuring is focused on simplifying operations within its People division rather than replacing workers with technology.

How many employees are affected?

While Uber has not disclosed the exact number of jobs being eliminated, a company spokesperson said the layoffs account for less than one per cent of its global workforce of approximately 34,000 employees.

Also Read | Are AI layoffs at Meta and Amazon squeezing Indian H-1B workers across the US?

The reductions are concentrated in recruitment and human resources teams. Uber's roughly 10 million drivers are not part of these figures, as they are generally classified as independent contractors.

According to reports quoted by NDTV, the company believes certain parts of its People organisation had become too complex, with overlapping responsibilities and unclear reporting structures.

Other changes underway

Alongside the job cuts, Uber is requiring HR employees who had previously been approved for remote work arrangements to follow the company's three-day-a-week office attendance policy introduced last year.

The latest move follows earlier workforce reductions in 2023 that affected Uber's recruiting division and its online grocery business, Cornershop. The company has not yet provided details regarding severance packages or other benefits for affected employees.