Atlassian has announced the dismissal of 1,600 of its employeesaround 10% of its staff, in a step that also involves the departure of its CTO Rajeev Rajan and various restructurings, with the aim of increasing investment in AI in the company. This workforce reduction attributed to AI occurs just a few days after Block also blamed Artificial Intelligence for the dismissal of 40% of its workers.
According to The Guardian, more than 900 of the layoffs will affect departments focused on software R&D, and the majority will be concentrated in North America: 640. In Australia there will be 480 laid off, and another 250 are from India. The rest will be distributed among the company’s workers in Japan, the Philippines, Europe, the Middle East and Africa.
The person in charge of breaking the news to the employees has been its CEO and one of its founders, Mike Cannon-Brookes, who has confirmed on the company blog that the measure taken is the appropriate step for the company, which has lost almost half of its market value since the beginning of the year due to investor fears that AI will make the software they develop obsolete.
As Cannon-Brookes stated in his post, on the other hand, the use of AI has changed the capabilities and positions that the company needs, which has motivated the need for a restructuring to strengthen Atlassian’s financial situation, also to be able to autonomously finance more investment in AI, as well as in company sales.
Regarding the answer to the question of whether AI was going to replace the 1,600 laid-off employees, he answered that his approach is not that AI replaces people, but that it would be false to pretend that AI does not change the mix of skills needed, or the number of positions needed for certain areas. Atlassian makes the majority of its revenue from its collaboration tools, including Jira, Confluence, and Trello.
The laid-off employees received an email informing them of their dismissal a few minutes after the CEO of Atlassian confirmed the transfer to the workforce. They will receive a minimum compensation consisting of 16 weeks’ salary, an extension of their health insurance and proration of their bonuses, as well as a one-time payment of $1,000 once they return their corporate laptop. Atlassian expects costs associated with the layoffs to reach $174 million.
