AI-Induced Job Displacement in HRM: Global Impacts and Strategic Responses

 

(Goddard. H, 2024) 

The growing use of artificial intelligence (AI) in Human Resource Management (HRM) and Strategic Human Resource Management (SHRM) has led to debates about job displacement and changes in work roles. Scholars have looked into how AI affects HR practices, employee duties, and workforce strategies. Two main theories, Technological Determinism (TD) and Technological Instrumentalism (TI), present different views on how AI will shape the future of work:

• Technological Determinism (TD) suggests that AI will inevitably lead to job loss and a major change in how work is done, as technology drives these changes (Brynjolfsson & McAfee, 2014).
• Technological Instrumentalism (TI) argues that AI is just a tool that can be used by humans to improve work, and it’s up to people to decide how it’s used, meaning it doesn’t have to lead to job loss (Cascio & Montealegre, 2016).

In short, TD sees AI as controlling the future of work, while TI believes humans have the power to shape AI’s impact.

1. Technological Determinism (TD) vs. Technological Instrumentalism (TI)

Technological Determinism (TD) posits that technology, particularly AI, inevitably leads to the automation and displacement of jobs. From this perspective, tasks traditionally performed by humans in HRM such as recruitment, performance appraisal, and administrative duties are increasingly being handled by machines, resulting in the loss of employment opportunities in these areas (Brynjolfsson & McAfee, 2014). This view suggests that AI-driven tools will replace workers in many routine and data-heavy roles, leaving humans to perform more strategic and creative tasks.

In contrast, Technological Instrumentalism (TI) argues that AI will not replace jobs but rather augment human capabilities. This perspective emphasizes that AI can enhance HR professionals' ability to make decisions by automating routine tasks, thus allowing employees to focus on more complex and human-centric aspects of HR, such as employee engagement, leadership development, and conflict resolution (Cascio & Montealegre, 2016). AI, from this viewpoint, is seen as a tool for empowering workers rather than rendering them obsolete.

2. Global Context of AI in HRM

The impact of AI on HRM varies significantly across different regions of the world due to economic, cultural, and political factors.

Developed Economies: 

In countries with advanced technological infrastructure, such as the United States and Western Europe, the focus has shifted toward reskilling and upskilling initiatives. Organizations are investing in employee training programs to ensure that workers can transition into roles where human expertise is still critical, such as leadership, decision-making, and innovation (Autor, 2015). Here, AI is viewed more as a complement to human labor rather than a replacement.

Emerging Economies: 

In developing countries, there is more concern about job displacement, particularly in industries reliant on low-cost, manual labor. The implementation of AI in HRM functions such as recruitment, training, and performance monitoring could disproportionately impact workers in sectors such as manufacturing, agriculture, and service (Chui et al., 2016). While AI offers the potential for economic growth, these countries may face challenges in providing training and resources to ensure workers are prepared for the changes brought about by automation.

3. Strategic HRM Responses to AI-Induced Displacement

Strategic HRM (SHRM) frameworks emphasize the need to align workforce strategies with organizational goals while considering the ethical and practical implications of AI deployment. Several strategies are recommended in the literature:

Job Redesign and Hybrid Roles: 

HR professionals are encouraged to redesign jobs to integrate AI effectively. This includes creating hybrid roles where AI handles repetitive tasks, and employees are tasked with strategic functions that require human empathy, critical thinking, and creativity (Susskind & Susskind, 2015). This approach can mitigate the negative impact of job displacement by creating new roles that blend human and machine capabilities.

Ethical Considerations: 

SHRM scholars stress the importance of addressing ethical concerns related to AI in HR. Issues such as algorithmic bias and data privacy are crucial in ensuring that AI-driven HR practices are fair and transparent. Organizations must ensure that their AI systems are free from biases that could perpetuate discrimination, particularly in hiring and performance evaluation (Cascio & Montealegre, 2016).

Employee Well-being and Communication: 

Effective communication about AI implementation is critical in maintaining employee trust and well-being. HR professionals must actively engage in discussions about the potential effects of AI on job roles and provide support for employees to transition to new roles or upskill (Susskind & Susskind, 2015).

4. Critical Evaluation of the Debate

While the literature offers valuable insights into the transformative potential of AI in HRM, there are criticisms and gaps that should be acknowledged:

Overemphasis on Job Loss: 

Some academics argue that the focus on job displacement overlooks the potential for job creation in AI-related fields. For instance, AI could lead to the development of new roles in AI governance, data analysis, and HR analytics, areas where human expertise will be necessary to oversee machine learning models and ensure fairness (Brynjolfsson & McAfee, 2014).

Inequality and Access to Reskilling: 

A significant concern in both developed and developing countries is inequality in access to reskilling opportunities. While large corporations may have the resources to provide upskilling programs, smaller organizations and workers in developing economies may face challenges in accessing the training needed to adapt to AI-driven environments (Autor, 2015).

Conclusion

AI-induced job displacement in HRM and SHRM is a multifaceted issue that requires careful consideration of both technological possibilities and human-centric practices. While some theories predict widespread job loss, others emphasize the opportunities for AI to complement human work. In a global context, the impact of AI on employment will vary, with both risks and opportunities for different regions. Strategic HRM practices focused on reskilling, ethical AI implementation, and job redesign will be crucial in ensuring that AI benefits both organizations and workers.

References

• Autor, D.H., 2015. Why Are There Still So Many Jobs? The History and Future of Workplace Automation. Journal of Economic Perspectives, 29(3), pp.3-30.
• Brynjolfsson, E. and McAfee, A., 2014. The Second Machine Age: Work, Progress, and Prosperity in a Time of Brilliant Technologies. W.W. Norton & Company, New York.
• Cascio, W.F. and Montealegre, R., 2016. How Technology is Changing Work and Organizations. Annual Review of Organizational Psychology and Organizational Behavior, 3, pp.349-375.
• Chui, M., Manyika, J. and Miremadi, M., 2016. Where Machines Could Replace Humans—and Where They Can’t (Yet). McKinsey Quarterly. McKinsey & Company. Available at: https://www.mckinsey.com/business-functions/mckinsey-analytics/our-insights/where-machines-could-replace-humans-and-where-they-cant-yet [Accessed 30 March 2025].
• Susskind, R. and Susskind, D., 2015. The Future of the Professions: How Technology Will Transform the Work of Human Experts. Oxford University Press, Oxford.
• Goddard, H. (2024) AI will transform the job market — but its impact doesn’t have to be negative. Available at: https://www.businessnews.ie/ai-digital-transformation/harry-goddard-ai-will-transform-the-job-market-but-its-impact-doesnt-have-to-be-negative/ (Accessed 30 March 2025).