Singapore’s DBS to reduce workforce by 4,000 amid rising adoption of AI

LONDON: Singapore’s largest bank, DBS, has announced plans to reduce its workforce by 4,000 positions over the next three years, attributing this move to the increasing implementation of artificial intelligence (AI) in tasks traditionally performed by humans.

A spokesperson for DBS communicated to the BBC that the workforce decrease would primarily result from natural attrition, occurring as temporary and contract roles phase out during this period. It was emphasized that permanent employees are not expected to face layoffs as part of this plan.

Piyush Gupta, the bank’s outgoing chief executive, also highlighted an expectation of generating approximately 1,000 new jobs related to AI.

This statement makes DBS one of the first significant banking institutions to provide insights into the anticipated impact of AI on its workforce. However, the bank did not disclose the specific number of job reductions in Singapore or identify which positions would be affected.

Currently, DBS employs between 8,000 and 9,000 temporary and contract staff and has a total workforce of around 41,000 employees.

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Last year, Gupta noted that DBS had been engaging with AI technology for more than ten years. He mentioned that the bank currently utilizes over 800 AI models across 350 different applications, projecting that the economic impact of these implementations could surpass S$1 billion (approximately $745 million or £592 million) by 2025.

As Gupta is set to depart the company at the end of March, Tan Su Shan, the current deputy chief executive, is poised to succeed him.

The rapid expansion of AI technology has raised important discussions surrounding its implications, with the International Monetary Fund (IMF) forecasting that nearly 40% of jobs globally could be influenced by AI advancements by 2024.

Kristalina Georgieva, the IMF’s managing director, warned that “in most scenarios, AI will likely worsen overall inequality.”

In contrast, Andrew Bailey, the governor of the Bank of England, expressed last year that AI would not be a “mass destroyer of jobs,” suggesting that human workers would adapt to collaborate effectively with new technologies. He acknowledged the associated risks of AI while also highlighting its significant potential for positive impact.