The rise of artificial intelligence is transforming human resources departments across major companies, as executives weigh productivity gains against potential job losses, according to a report in the Financial Times.
At RingCentral, a communications software firm, the HR team has been cut by nearly half over the past two years, despite the department having expanded during the pandemic to handle a surge of new hires. Alvin Lam, RingCentral’s head of HR, told executives he could likely reduce staff further with the help of AI tools such as the company’s HR chatbot, Ringo, while maintaining service levels.
Lam’s comments highlight a growing tension for HR leaders: they must leverage AI to meet corporate productivity goals while safeguarding the human touch in critical functions. Across the U.S., early adoption of generative AI remains limited but is expanding quickly, with the US Census Bureau reporting just over 9% of companies using AI in production of goods and services—a figure that is rising steadily.
Executives at firms including Salesforce, Amazon, and JPMorgan Chase have signaled that AI will reshape staffing levels. At JPMorgan Chase, Marianne Lake, CEO of consumer and community banking, told investors that AI adoption in the bank’s operations department could reduce headcount by 10% over the next five years, even as business grows by more than 25%.
The use of AI in HR spans recruitment, performance management, training, and internal support. At IBM, for example, 94% of routine HR queries are now handled by the company’s AskHR chatbot, which leverages generative AI to answer staff questions based on a comprehensive database of policy documents. Canadian software firm Vendasta Technologies is also deploying AI to screen candidates, potentially saving over 1,000 hours of recruiter time annually.
However, adoption is constrained by regulatory and legal considerations. The EU’s AI Act classifies certain HR AI tools as “high risk,” while California is considering legislation to prevent automated systems from making employment decisions without human oversight. Litigation has already begun in the U.S., with a technology worker suing Workday for alleged discriminatory hiring practices by its AI system.
Industry experts note that AI could either benefit labor through increased efficiency and retraining opportunities or primarily reward capital through higher profits and executive pay. Laszlo Bock, former Google HR chief, argues that the post-pandemic period is a crucial moment for HR departments to demonstrate whether they truly advocate for employees or merely enforce top-down mandates.
Despite fears of widespread automation, research suggests AI’s impact on overall employment remains limited. Goldman Sachs analysts report that the majority of U.S. companies have yet to fully integrate AI into regular workflows. Nevertheless, HR functions are among the first to feel the effects of automation, with estimates suggesting that up to 80% of routine HR tasks could eventually be automated, while critical interpersonal functions remain human-led.
Salesforce CEO Marc Benioff and other corporate leaders emphasize that AI’s primary role should be to free human employees for higher-value tasks, rather than replace them entirely. As HR departments adapt, experts suggest a careful balance is needed between AI-driven efficiency and maintaining meaningful human interactions, especially in sensitive areas such as recruitment, conflict resolution, and employee wellbeing.
The Financial Times notes that the shift toward AI-driven HR represents both a strategic opportunity and a test for the profession: departments must navigate technological change while proving they can continue to serve employees and preserve human judgment in workplace decisions.
