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Tuesday, February 11, 2025

Title: How AI is Shaping Salary Increases in the Workplace: A Shift Towards Progress

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Artificial intelligence is increasingly employed by companies to address gender disparities in the workplace by mitigating biases in decision-making, particularly regarding salary increases. IBM utilizes AI to analyze various employee factors and make data-driven salary recommendations, which managers largely follow. While AI improves compensation equity, challenges arise in task management and algorithm clarity. Experts emphasize the necessity of human oversight and regulatory frameworks to ensure responsible AI use, especially as its influence continues to grow.

Can Artificial Intelligence Bridge the Gender Gap?

In today’s business landscape, artificial intelligence (AI) is being harnessed to tackle the persistent inequalities between women and men. Companies are increasingly turning to AI to help mitigate both conscious and unconscious biases. A notable example is IBM, a leading software firm that utilizes AI to assist in determining employee salary increases. The AI tool developed by the Paris-based company evaluates around twenty different factors, including tenure and the scarcity of specific skills.

According to Vincent Perrin, a manager at IBM, the AI analyzes various parameters such as competitive positioning, recent salary adjustments, and previous performance reviews. After processing this data, the AI generates a recommendation for salary increases—categorizing them as low, medium, or high. Remarkably, managers adhere to these AI suggestions in 95% of cases. However, Perrin emphasizes that the final decision still rests with the manager, who retains the discretion to adjust the proposed increase based on their judgment of the employee’s situation.

The Role of AI as a Decision-Making Tool

The implementation of such AI systems not only streamlines decision-making for managers but also ensures a more equitable approach to compensation. Xavier Vasquez, executive director at IBM, highlights that AI can significantly reduce biases by providing data-driven recommendations that are impartial to factors like age or gender. He states, “Here, I submit this recommendation to you, and you can make your decision.” This structured approach has been positively received by employees, many of whom feel that AI serves as an essential support tool in larger teams, where understanding each individual can be challenging.

Furthermore, AI’s capabilities extend beyond salary recommendations. In some settings, AI systems are capable of directing employees’ tasks. For example, a recent report showcased a logistics center in France where robots interact with staff, guiding them on product storage. Nevertheless, reliance on AI does come with challenges. Some delivery drivers have expressed confusion over instructions received from algorithms that determine their assignments and compensation. In response to concerns, platforms like Uber Eats have adjusted their pricing algorithms to consider various factors, including delivery times.

As AI becomes more adept through human training, its influence grows. However, experts like Laure Lucchesi stress the importance of human oversight, particularly when AI impacts people’s lives. To address these concerns, strict regulations are in place, governed by a European law established last year, ensuring the responsible use of artificial intelligence in France.

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