Major New York Firm To Replace Staff With A.I.
April 1, 2017
A major New York firm is set to become the first in America to lay off a large percentage of its staff, replacing them with Artificial Intelligence (A.I.)
The World’s largest money management firm, BlackRock, explained that the drastic overhaul of its workforce is being done so that it can focus on using an algorithmic solution to improve its services and increase revenue.
As a result, 13% of people working within management will be fired.
The decision to transition comes after news of a massive overhaul that involved a reorganization within BlackRock. The purpose of the reorganization was to place a greater emphasis on computer algorithms that can inform investments. Quite simply, investors are now questioning whether having a human manage their money is worth the fees they require, especially since successful money management is essentially anchored on recognizing and following certain market indicators — the sort of things artificial intelligences (AI) can be programmed to do.
In light of that, BlackRock plans to merge traditional investing methods with technology and data science. This strategy marks the biggest shift in traditional stock picking by a major asset manager to date. It will impact $30 billion worth of assets, and roughly 13 percent of BlackRock’s portfolio managers will be laid off as part of the transition.