- AI-related jobs are up. LinkedIn reports applications for AI-related jobs are up 16% this year, and 13% more organizations have created “Head of AI” roles since December 2022.
- There are needs and jobs to fill. A Microsoft and LinkedIn report found 55% of surveyed leaders are concerned about having enough talent to fill AI roles in the year ahead.
- Look at similar roles. Organizations can look at their top cybersecurity positions as a starting place when considering a total rewards package for a CAIO.
Say hello to the latest C-suite member — the chief artificial intelligence officer (CAIO).
With 75% of global knowledge workers now using generative AI, organizations such as Dell and NASA are integrating a CAIO into their core strategies. Others are following suit: LinkedIn reported that applications for AI-related jobs are up 16% this year, and 13% more organizations have created “Head of AI” roles since December 2022.
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“AI is redefining work, and it’s clear we need new playbooks,” LinkedIn CEO Ryan Roslansky said in a recent statement. “It’s the leaders who build for agility instead of stability and invest in skill-building internally that will give their organizations a competitive advantage and create more efficient, engaged and equitable teams.”
Having a CAIO on the payroll is uncharted territory for most HR and total rewards professionals, who must learn how to create compensation and total rewards packages for a job that didn’t exist a few years ago. Having that CAIO in place now (or soon), though, may put those employers ahead of the curve, as experts proclaim 2024 as the year AI at work “gets real.”
Behind the Hiring Boom
In October 2023, President Biden issued an executive order for federal agencies to coordinate their approach to the development of AI and similar technologies. One of the requirements called for federal government agencies to appoint CAIOs to their organizations. (In addition to NASA, the Office of the Director of National Intelligence also appointed its own CAIO this year.)
On April 29, six months after the executive order, the U.S. Department of Labor’s Wage and Hour Division published new field assistance guiding its staff on the implications of employers’ increasing use of automated systems and AI technologies. The guidance emphasized several key areas of federal labor laws that may be implicated by employers’ use of automated systems or AI, including hours worked, calculating wages and administrating leaves.
With the new guidance and regulations, it may behoove organizations to assemble specific governance and put someone in charge of compliance. Jason Averbook, senior partner and global leader of digital HR strategy at Mercer, said this oversight need may well explain the rise of CAIOs.
In addition, Averbook stated continuous AI and technology emergence has generated fears among some organizations that they must evolve with the times or risk obsolescence. He said such organizations are seeking to mitigate such fears through the establishment and expansion of AI leadership and management roles.
But employers would be remiss to lump a CAIO into just a tech role, said Averbook.
“A CAIO needs to be tied into the business because AI should be driving innovation in business outcomes,” he said. “They belong in the C-suite, along with finance and the CIO (chief information officer).”
The CAIO role is indeed filled with many layers and responsibilities, according to Rebecca Toman, vice president of the survey business unit at compensation advisory firm Pearl Meyer. Responsibilities include aligning AI implementation and use with the organization’s overall strategy, leading the development of AI policy and deployment across the organization, and helping to ensure adherence to AI-related regulatory compliance. Given that, it may not be surprising that Pearl Meyer’s March 2024 Quick Poll: AI’s Impact on Organizational Structure and Investments found 9% of the 142 survey respondents already have a designated AI leader.
Even though the CAIO is still relatively new, Averbook predicted employers will go on a hiring spree for this position in 2025 and over the next three to five years.
“This job is going to explode next year,” he said. “It wasn’t in the budget in September 2023, but it will be there in September 2024.”
The Total Package
In a competitive labor market, it is critical to obtain reliable and current market data when putting together a compensation and total rewards package for any leadership position — and that is most definitely the case for a CAIO, said Toman. Glassdoor reported a CAIO can earn up to $525,000.
“Companies can look at pay for similar roles like top cybersecurity positions and consider adding a premium or differential,” Toman said.
Toman also noted Pearl Meyer’s Cyber Security, AI, and Data Science Salary Survey found that 53.7% of surveyed organizations do not pay AI positions different than cybersecurity positions; but among those that do pay differently, 92.3% pay a premium for AI roles compared to cybersecurity.
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Michael Piker, the incoming vice president of global total rewards at cosmetics company Shiseido and a member of WorldatWork’s Global/Total Rewards Advisory Council, said companies should consider a skill-based rewards package that incentivizes speaking, writing and publishing to ensure the CAIO hire is internally/externally recognized and respected.
“The short-term and long-term incentive design would be bespoken and have unique value creation triggers, such as AI adoption enterprise-wide and how the organization thinks, acts and operates with AI as its core precept,” he said. “The key point is to think about rewarding these roles in a completely unique way, almost like a venture business separate from your mainline business.”
Averbook said it would be a mistake to copy and paste the job description (and related pay and benefits package) for a CIO job with that of a CAIO officer. “There are similarities, but a CAIO is about innovation and taking risks, while a CIO’s job is keeping the infrastructure safe and the lights on,” he said.
Instead, Averbook felt a CAIO is more akin to a chief digital officer (CDO). “There are more benchmarks out there for a CDO, and they are tied to the same mindset and strategy,” he said. “If you look at a CDO, they are closely related to a CAIO in terms of transformation and innovation.”
An additional consideration would be whether the role is focused on work and outcomes that are outside or inside the organization.
If the CAIO has an external business focus, Averbook suggested compensation benchmarks based on customer sales and revenue. If the focus is internal, base the compensation on organizational cost and labor savings.
While many organizations are just now saying hello to the CAIO, Averbook predicted the role — in its present dedicated form — won’t be around forever. But that doesn’t mean you can or should downgrade its importance.
“It’s a fascinating new job, but eventually, AI will be infused to every job,” he said. “As technology continues to evolve, it will make the job obsolete, and the CAIO [or the next incarnation of the CAIO] will move on to the next innovation that comes up.”
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