SAP bets AI can reinvent jobs instead of cutting them

SAP said its €2 billion restructuring plan would cover about 8,000 roles and be carried out mainly through voluntary leave programs and internal reskilling, not mass layoffs. The German software group said it expected to end 2024 with headcount similar to current levels, even after entering the year with nearly 108,000 full-time employees at the end of 2023. Investors seized on the pledge, pushing SAP shares up 7% to an all-time high after the announcement.

The company has since leaned harder into the case that AI can reshape work without simply shrinking payrolls. Chief executive Christian Klein has promoted embedded products such as the Joule copilot and argued that AI will change how people work. By July 2024, SAP said more than 27,000 customers were already using SAP Business AI, and it planned more than 100 new high-value AI use cases across its portfolio by the end of 2024. That is the business case behind the workforce pitch: if AI is becoming part of the product stack, SAP says, jobs can be redesigned around it rather than removed by it.

The restructuring language, though, makes clear that SAP is not promising a no-cut future. The company said it would spend the money on a program to either retrain employees with AI skills or replace them through voluntary redundancy programs. That puts the focus on which functions are being reworked first. The clearest pressure points are likely to be repetitive and entry-level tasks, the kinds of roles labor-market observers say are most vulnerable when software lifts productivity and compresses staffing needs.

SAP’s internal mood has been upbeat. Chief future of work officer Christian Schmeichel said an internal study from late 2023 found 80% of respondents were optimistic about AI. That sentiment matters because the company is asking workers to see AI as a path into new roles, not a prelude to exits. Still, optimism is not the same as evidence.

The proof will come from the numbers SAP has already put on the table. If the company reaches the end of 2024 with headcount still near current levels, moves a meaningful share of the 8,000 affected roles into new assignments, and turns the restructuring into the roughly €500 million in added operating profit it expects in 2025, it will have made a credible case for redeployment. If the payroll falls while AI output rises, the “AI without layoffs” model will look less like reinvention than a more polished form of restructuring.