Shopify Relying On A.I. To Keep Employee Headcount Flat

Canadian e-commerce company Shopify (SHOP) is turning to artificial intelligence (A.I.) to keep its employee headcount flat and manage costs.

Shopify Chief Executive Officer (CEO) Tobi Lutke says that, going forward, employees will be required to prove that a particular job at the company cannot be done with A.I. before asking for more human staff and to increase the company’s workforce.

Lutke made the comments in a memo to staff that he also posted on social media.

The CEO added that there’s a “fundamental expectation” across Shopify that employees embrace A.I. in their daily work, saying it has been a productivity enhancer at the company.

Shopify, which helps retailers run their operations online, will also factor A.I. usage into future performance reviews, said Lutke.

The Ottawa-based company has made A.I. tools for its merchants a central part of its client offerings, introducing a chatbot called “Sidekick” and automation tools named “Shopify Magic.”

Cost savings also continue to be prioritized at Shopify. The company cut 14% of its workforce in 2022 and 20% in 2023.

At an investor event earlier this year, Shopify executives said they are confident that they can keep headcount flat by adopting new technologies that boost productivity.

The stock of Shopify has declined 27% so far this year to trade at $78.82 U.S. per share on the Nasdaq exchange.