Business News Report
July 24, 2023

Shopify Employee Alleges Massive Layoffs and AI Chatbot Takeover

In Brief

Shopify employee alleged that the CEO, Tobi Lutke, had been discreetly dismissing the global customer service team across multiple countries, intending to replace them with AI chatbots.

Beyond Shopify, the integration of AI has been evident across industries, leading to workforce reductions in various companies.

shopify employee

Shopify employee has alleged that the e-commerce giant is laying off staff and replacing them with artificial intelligence. The employee brought to the public’s attention a series of troubling actions and strategic decisions made by the company. 

Twitter user “Joe Momma” wrote that Tobi Lutke, the CEO of Shopify, has been quietly dismissing the global customer service team across the US, Canada, and Ireland, with plans to replace them with AI chatbots.

They brought to light a sequence of events that began in the first quarter of 2022, when Shopify made assurances of job security to its employees. However, massive layoffs took place in July of the same year. 

The employee who revealed this information suggests that these job cuts were not simply the result of a CEO’s misguided decision but a deliberate shift towards replacing full-time staff with more cost-effective contract labor while increasing reliance on AI support.

“Everything in Shopify is turning to AI, from product descriptions to virtual sidekicks to a new help center AI agent (that is still in beta testing and yet to be released),”

the former employee wrote.

Besides, he reposted Lutke who shared how companies have been requiring fewer employees over the years, all thanks to technology.

The Twitter thread has been widely shared and discussed, drawing a mixed reaction from the public. Some people have expressed support for the user for speaking out, while others have criticized them for violating their NDA. Shopify has not yet responded to the allegations, but the company might face increased pressure to address them.

Note: The user’s account was created in July 2023, and all their posts exclusively focus on Shopify. This level of anonymity inevitably raises questions about the posts’ credibility.

Companies are Replacing Staff with AI

Last week, the CEO of an Indian startup, Summit Shah, laid off 90% of his support staff. He shared about the workforce reduction via Twitter, which garnered negative feedback.

His decision came after the company developed a chatbot, which, according to Shah, can handle customer queries much faster than human employees.

In a tweet on Monday, Shah revealed that the chatbot, created by one of the firm’s data scientists in just two days, provides instant responses to initial customer queries. However, the staff took an average of 1 minute and 44 seconds to respond.

In recent months, more and more companies have been implementing automation technologies, such as chatbots and natural language processing software, which have resulted in layoffs. The objective is to reduce costs and maximize profits, which has resulted in increased job losses.

Global tech company IBM is pausing job applications that AI can replace. The company’s CEO, Arvind Krishna, said that 30% of the company’s back-office roles could be automated by AI over a five-year period, which could lead to the loss of about 7,800 jobs.

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About The Author

Agne is a journalist who covers the latest trends and developments in the metaverse, AI, and Web3 industries for the Metaverse Post. Her passion for storytelling has led her to conduct numerous interviews with experts in these fields, always seeking to uncover exciting and engaging stories. Agne holds a Bachelor’s degree in literature and has an extensive background in writing about a wide range of topics including travel, art, and culture. She has also volunteered as an editor for the animal rights organization, where she helped raise awareness about animal welfare issues. Contact her on [email protected].

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Agne Cimerman
Agne Cimerman

Agne is a journalist who covers the latest trends and developments in the metaverse, AI, and Web3 industries for the Metaverse Post. Her passion for storytelling has led her to conduct numerous interviews with experts in these fields, always seeking to uncover exciting and engaging stories. Agne holds a Bachelor’s degree in literature and has an extensive background in writing about a wide range of topics including travel, art, and culture. She has also volunteered as an editor for the animal rights organization, where she helped raise awareness about animal welfare issues. Contact her on [email protected].

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