Did AI Play a Role in Ocado's 1,000 Job Cuts?

Online grocery firm Ocado announced plans last week to slash 1,000 jobs from its workforce of about 20,000 people.

The firm, which has headquarters in Hatfield, Hertfordshire, suggested the company's tech wizards had been victims of their own success.

"We have largely completed a very significant phase of investment in our robotics and automation capabilities," said chief executive Tim Steiner.

Steiner is talking about AI. But did it really play a role in the company's decision to cut so many jobs?

'Replacing us'

Former employee John Williams remembers working at the original warehouse in Hatfield more than 20 years ago when the company was "tinkering" with robotic systems.

At the time, Ocado Group was out on its own, pioneering the not-so-popular idea of online supermarket shopping.

"They had a sophisticated-looking connecting system – like a robotic trolley – that went around by itself," he recalled.

"It was regarded as the automatic shopper, but it didn't quite work. It had to be loaded by people."

He worked in the unloading team until 2004, and said at the time, it was not yet clear that robots could one day "replace us".

In 2023, Ocado announced the closure of the Hatfield warehouse and opened new sites where robots were used to pick and transport food items, leading to a steadying reduction of the human workforce.

On Thursday, the company said the 1,000 redundancies would be made across the world, mainly across technology and support roles.

The move would save them £150m, a spokesperson said.

Speaking to the BBC, analysts could not be sure whether technology was taking anyone's job at Ocado this time around.

However, they said the redundancies were likely the result of rival companies putting AI to good use and finally catching up with Ocado's success.

- Author: Louise Parry, BBC

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