How some of the largest companies in the US are using AI to cut workers

Artificial intelligence has emerged as an important tool for businesses to drive growth and reduce labor costs. This is especially due to pressures to keep companies competitive.

Companies across industries ranging from cloud software to fast food and e-commerce are deploying AI tools internally to improve productivity, customer experience and supply chains. AI also reduces human labour reliance in some spaces, particularly in positions related to entry-level work and automation and manual tasks.

According to Jan Hatzius, chief US economist at Goldman Sachs, unemployment rates rose among young tech workers, which overlap with AI models this year.

“The impact of the aggregated labor market from the generated AI remains limited, but evidence of labor demand hits is beginning to be seen in industries most exposed to AI,” Hatzius wrote to his client in a July 25 memo. “Employment growth has been negative in marketing consulting, call centres, graphic design, web search and software development, with employment shares in the tech sector below the long-term trend.”

Certainly, it is difficult to quantify the precise impact that AI has on labor at this stage of the technology cycle. One way to understand trends is to evaluate commentary made by large employers and top executives of high-growth companies.

CNBC has compiled commentary from management teams in the range of companies McDonald's In Amazon In Palo Alto Networkit is used to improve productivity, customer experience, supply chain, and potential personnel on how AI tools and agents are deployed.

This statement shows that major technology and software companies are using AI to reduce labor needs and increase productivity.

Microsoftone said that they're saving hundreds of millions of dollars a year by simply leveraging AI for support features. It added that “you don't need human interaction” to make these roles more productive. PayPal's The “PayPal Assistant” customer service BOT has already cut down on calls and active events, the company's CEO said earlier this year.

According to Brad Zelnick, analyst at Deutsche Bank, the key AI use cases for software companies appear to be developer productivity, customer service, support, and seller efficiency. This refers to how a company's sales revenue compares it to the resources it used. Software companies are also increasingly citing the use of AI across functions such as finance and relationships, he added.

“While some teams are more clear about labor savings (approximately 50% of companies that discussed the use of internal AI mention streamlining), many teams focus on meaningful improvements in efficiency that should promote labor savings over time, or at least hire at a slower rate. He highlighted. Palo Alto Network, Cloud Strike, Shopify, Intuition and Microsoft Some outstanding names that use AI are said, “We should support our ability to improve incremental margins.”

“I think there are similarities between industries when software companies are cutting/slowing down staffing, and I think seat-based models will continue to be questioned, even if they can price the value price that is creating the near future,” added Zelnick.

Robotics remains the focus of shipping and e-commerce companies looking to reduce labor costs.

UPS' The CEO said in the company's second quarter revenue call in May that the greater use of automation and robotics will “will become less labour-independent.” Amazon CEO Andy Jassy said in July that the company uses more than 1 million robots across its facility. This is “improving cost-effectiveness,” and speeds up delivery times and cost reductions to customers.

Certainly, companies have chosen a careful message about AI and its impact on labor.

Starbucks It uses AI in that order, such as the “Green Dot Assist” platform created with Microsoft Azure's Openai, but so far it's framed the technology as a Barista supplement. Amazon's Jassy executive says the robots reduce the number of physically demanding tasks for team members and make operations safer.

Long-term employment cycle in “high impact regions”

This year has been tough for job seekers, and markets are undermining by freezes, wider economic concerns and pressure on entry-level employment. But in the long run, some say on the streets, AI will cultivate more employment opportunities rather than lead to widespread layoffs.

“We are skeptical that AI will lead to massive job cuts over the next decade, primarily because AI-related innovations create new job opportunities that offset unemployment from automation,” said Hatzius of Goldman.

Job cuts at major tech giants have been seen since Moreso highlighted the fix, according to Jefferies Analyst Brent Thill.

Jeffries was strong in 2025 despite employment growth across software and internet companies falling below peak levels in 2021 and early 2022. Only 23% of the company's reporting tech companies announced layoffs this year, starting from 37% in 2024.

“Overall, we see current layoff cadence as a sign that the industry is nearing the end of recalibrating the post-Covid workforce,” Thill said in a July memo to clients. “AI is promoting new employment cycles while promoting efficiency. AI continues to increase efficiency and restructure the needs of the workforce, particularly in automating low-skilling roles, but we also see selective employment in areas with high impact.”