Outsourcing firms announce major layoffs in 2024
OHIO, UNITED STATES — Several major outsourcing and information technology (IT) service providers have announced significant workforce reductions in 2024, mirroring the broader tech industry’s restructuring efforts.
This trend was highlighted in a list compiled by R&D World, using data from layoffs.fyi and TechCrunch, which tracks layoffs across the tech, telecom, and innovation sectors.
Amdocs, IBM, Ricoh, and Scale AI lead job cuts
Amdocs, a leading provider of IT services for communications and media companies, cut between 1,500 and 3,000 jobs — representing 5-10% of its workforce. Similarly, IBM is reduced its headcount by 1,000 employees as part of a broader restructuring effort aimed at streamlining operations while investing heavily in artificial intelligence (AI) and cloud services.
Ricoh, which has transitioned from a traditional office equipment company to a digital service and outsourcing provider, eliminated approximately 2,000 positions globally. The company is focusing on digital transformation to enhance profitability and operational efficiency.
Scale AI, known for its data labeling outsourcing through its Remotasks division, terminated over 1,000 remote contract workers. These terminations were carried out via email and have drawn attention due to the scale of the cuts and the company’s reliance on outsourced labor for AI training tasks.
Meanwhile, OpenText, another major player in information management services, laid off 1,200 workers (1.7% of its workforce) as it adapts to changing market demands and focuses on AI-driven solutions.
Tech layoffs hit record levels amid AI investments
According to R&D World, tech layoffs have surged to their highest levels since the Dot Com Bubble burst. As of November 2024, TechCrunch reported that over 130,000 jobs had been cut across 457 companies.
R&D World added that many companies are making layoffs even as they invest heavily in AI. Traditional tech firms like SAP are leading this trend by cutting up to 10,000 jobs while investing €2 billion annually into AI initiatives. Similarly, Intel has reduced its workforce by 15,000 employees while focusing on AI chip development.
Industry-wide shift toward automation
The automotive sector has also seen significant restructuring with over 19,000 job cuts as companies like Tesla pivot toward robotics and autonomous technologies. Even the telecommunications sector has shed over 16,000 jobs as firms shift toward digital transformation.
While these cuts are substantial, they reflect an industry-wide pivot toward emerging technologies like AI and automation. Many companies are not just reducing costs but reimagining their workforce composition to align with future technological demands.
