When Kent Ha was laid off from his digital marketing role at Intel last July, he was prepared for the possibility of his job being cut because of AI.
Due to previous layoffs, he was concerned about his job security. Additionally, earlier in the year, Intel announced plans to outsource much of its division’s work to Accenture and said it would use AI to enhance its marketing efforts.
“That made it seem like our group was even more likely to be attacked,” said Ha, who is in his 30s and is based in Portland, Oregon.
Over the past year, I’ve talked to dozens of white-collar workers who were recently laid off and wondered why they were fired. Those who did not see concerns about individual performance pointed to a variety of possible explanations, including cost cutting, the Great Flattening, and pandemic-era overhiring. And one question kept coming up: Is the AI to blame?
As companies pour money into AI, it remains unclear whether the technology will replace jobs or create new ones. Some have suggested that the goal is to replace human employees, while others are less clear. Instead, they are cutting headcount while simultaneously funding massive AI investments and leaving workers to connect the dots.
According to Challenger magazine, U.S. employers blamed AI for about 55,000 planned layoffs last year, up from a total of about 17,000 in the previous two years. As pressure increases to demonstrate returns from AI investments, companies may respond by tightening performance standards and ultimately firing workers who can’t keep up.
Still, most companies stop short of blaming AI. A Microsoft spokesperson previously told Business Insider that the company is focused on reducing management layers and streamlining processes. Amazon also cited efficiency and culture as reasons for the cuts.
Regarding the layoffs that affected Mr. Ha, an Intel spokesperson said the company is “taking steps to become a leaner, faster and more efficient company.”
Confused by AI’s role in layoffs, workers are not just trying to process the news, they want to better assess what they’re facing in today’s job market. They know that succeeding in an AI-driven future may require them to learn new skills and explore new roles. They just want to know if the future they’ve been dreading has already arrived.
AI’s impact will be top priority for workers as they navigate through layoffs
When Joe Friend learned in May that he was losing his job along with thousands of others at Microsoft, he said he was “not at all surprised by the layoffs.” I was surprised to be caught up in it.
A friend in his 60s from Washington state was a director of product management overseeing a team of nine people. He said he has seen speculation online that the layoffs are related to productivity gains from Microsoft’s AI investments, meaning that AI is effectively “eroding” people’s jobs. But he said he hasn’t seen much evidence that AI significantly improves productivity and suspects the cuts are about freeing up money for those investments.
“I think these are cuts to offset the huge expense that’s being spent on AI architecture,” he said. “In that sense, AI will eat your job, but not in the sense that AI will create productivity gains.”
Ian Carter, another laid-off Microsoft employee, pointed to the company’s heavy investment in AI and overhiring during the pandemic. While pursuing a role similar to his previous technical program manager position, he also began developing his AI skills. We noted that job postings are increasingly in demand for that expertise.
Which professions would be most vulnerable to AI takeover has been the subject of speculation for years. James Huang, who lost his job at Amazon in October, said he was aware that his role providing IT support to Amazon employees could be at risk from automation. And last June, Amazon CEO Andy Jassy said he expected the efficiency gains from AI would eventually lead to a reduction in the company’s workforce.
Still, while Huang’s team had started using AI to help troubleshoot issues, he didn’t think the technology was widespread yet. He is currently applying for a similar IT support role, but has not changed his job search strategy due to his concerns about AI.
“Amazon is not yet at a stage where AI can do our jobs,” said Huang, a 20-year-old from Michigan. “For us, AI is a tool because we need the human touch for support.”
Friend and Huang, who were among several employees who were laid off, told Business Insider that they believe AI’s role in the layoffs has less to do with automating jobs and more to do with freeing up cash to fund AI investments. But ultimately, the economic impact is the same for those who lose their jobs. Friend said he plans to choose his next role carefully, as he believes it’s becoming increasingly difficult to find job security in the technology industry.
Read more about people at corporate crossroads
Has AI stolen your job, your budget, or maybe it’s time to reinvent your career?
For laid-off workers wondering if AI is playing a role in their job loss, clear answers may never come.
A company’s decision to downsize employees is often determined by a variety of factors, from financial pressures to changing priorities. And even if management provides an explanation for the cuts, it may only reflect part of the story. It is shaped by your message strategy as well as your internal reasoning.
While 90% of analysts recently surveyed by Goldman Sachs said AI has not yet affected employment levels at their target companies, 60% expect it to cause a decline in employment over the next five years.
Amid this uncertainty, some laid-off workers have decided to acquire AI skills to prepare for the evolving job market.
When Lee Givens Jr. previously worked as a product manager at a software development company, he watched his colleagues leave for companies willing to pay higher salaries for AI talent. So when he was laid off in 2023, he started thinking about how to better position himself in a tech industry that has clearly moved towards AI.
Givens Jr. decided to research AI frameworks related to his field in hopes of making himself a more attractive candidate. He believes the investment paid off, and said he was later able to take a staff product manager position at a Toyota subsidiary, where he is now using his knowledge of AI.
“When you have big technology changes, like the rise of the internet or AI, you have to reinvent yourself,” he says.
