AI Will Slow Hiring at Israel Aerospace Industries, Union Head Says

By שרון כידון

Translated & summarized from Ynet by baba

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Yair Katz, Chairman of the Israel Aerospace Industries Workers' Committee, announced that the company is slowing its hiring rate due to the integration of artificial intelligence, which he believes could reduce the need for some personnel. Katz expressed confidence that proper preparation, including worker training, will prevent AI-related layoffs. He also discussed the challenges of defense supply chains due to foreign embargoes, the benefits of an upcoming IPO for employee compensation and competitiveness, and the need for Israel to achieve greater self-sufficiency.

The story in 6 lines · by baba

Israel Aerospace Industries is slowing hiring due to AI integration, according to union chairman Yair Katz.
Katz believes proper worker training and preparation can prevent AI-related layoffs.
Foreign embargoes since October 7th have complicated supply chains for Israeli defense industries.
IAI is seeking to reduce regulations to better compete for talent with high-tech firms.
The company's upcoming IPO is expected to boost investment in R&D and employee compensation.
Katz urged other union leaders to prepare their workers for the impact of AI.

Yair Katz, Chairman of the Israel Aerospace Industries (IAI) Workers' Committee, stated that the integration of artificial intelligence (AI) into the company will impact the pace of new hires, though he believes proper preparation can prevent layoffs. Speaking at the "People of the State" conference organized by Ynet and "Yedioth Ahronoth," Katz also addressed the company's planned IPO, Israel's defense independence, and his potential future candidacy for the leadership of the Histadrut labor federation.

Katz emphasized the need to reduce regulatory burdens on IAI to enable it to compete for talent with major high-tech firms. He warned against Israel's reliance on foreign suppliers, noting that since October 7th, some countries and companies have ceased or complicated dealings with Israeli defense industries, creating supply chain issues. However, Katz views these embargoes as an opportunity, stating that IAI is finding local or alternative replacements for components it can no longer procure, expressing confidence in achieving self-sufficiency for critical products.

Regarding the upcoming IPO, Katz expects it to boost IAI by injecting funds for R&D and new technologies. While the state may benefit from debt reduction or additional revenue, Katz's primary concern is how the IPO will benefit the 16,000 employees. He hopes it will facilitate the removal of burdensome government regulations, allowing for higher salaries to attract top engineering and high-tech talent, similar to companies like Nvidia. He also mentioned that employee compensation could shift from cash bonuses to company stock, giving workers a stake in ownership.

Addressing the impact of AI, Katz, a proponent of technology, acknowledged that it's impossible to compete with AI and that the union has hired an AI consultant to analyze market changes and prepare workers through training and courses. He confirmed that IAI is slowing its hiring rate due to AI's potential to reduce the need for some personnel. Katz stressed that with adequate preparation, training, and a moderated hiring pace, layoffs due to AI can be avoided, urging other union leaders not to ignore this trend.

Katz also advocated for increased salaries and differential bonuses for public sector employees, arguing they deserve better compensation for their contributions to society. When asked about potentially running for the leadership of the Histadrut, he stated that while he finds the role fascinating and important, he is currently focused on his position at IAI, leaving the future open.

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