AI-related layoffs will exceed 50,000 in the U.S. alone in 2025, according to new data from consulting firm Challenger, Gray & Christmas (via CNBC). According to the company, companies directly cited artificial intelligence (AI) as the reason for 54,883 layoffs this year, making it one of the biggest drivers of layoffs across the technology industry. The job cuts come as companies use AI as a cost-cutting tool to combat inflation, high tariffs and pressure to improve profitability. A recent study from the Massachusetts Institute of Technology (MIT) released in November also suggests that AI could handle 11.7% of U.S. jobs and save companies $1.2 trillion in wages across financial, healthcare, and professional services.But some experts question whether AI is the real reason for such widespread layoffs. Fabian Stefani, an assistant professor of AI at the Oxford Internet Institute, told CNBC that many companies may have overhired during the pandemic and are now using AI as a convenient “excuse” to downsize. Despite the debate, many companies, including some of the world's largest technology companies, explicitly cited AI as a reason for restructuring this year. Here are four major technology companies that screamed AI when announcing layoffs.
Amazon
The e-commerce giant laid off 14,000 employees this year, making it one of its largest companies. Announcing the layoffs, Beth Galetti, Amazon's senior vice president of people experience and technology, said the company is “making organizational changes that include layoffs in some areas and hiring in others.”“This generation of AI is the most transformative technology since the Internet, allowing companies to innovate much faster than ever before (in existing market segments and entirely new market segments). We believe we need to organize more efficiently, with fewer layers and more ownership, to act as quickly as possible for our customers and our business,” Galetti explained.During the company's earnings call a few days later, Amazon CEO Andy Jassy explained, “The announcement we made a few days ago is not really finance-driven, and it's not really AI-driven, at least not right now. It's really about culture.”
microsoft
Microsoft has made at least four major layoffs, cutting about 15,000 jobs this year. Julia Lewson, Microsoft's president of development, then instructed managers that the use of artificial intelligence “should be part of a holistic reflection on individual performance and impact.” Lewson later declared in an internal email that “the use of AI is no longer optional, but core to every role and at every level.”The company also said it is considering adding formal AI usage metrics to performance reviews to accelerate adoption of Copilot AI services, according to a source familiar with the plans, adding that some teams are considering including specific AI usage benchmarks in employee reviews next year.
sales force
In September, Salesforce CEO Marc Benioff acknowledged that AI automation had eliminated 4,000 customer support roles. Additionally, Benioff said AI is already doing “up to 50% of the company's work” and fewer staff are needed for many support functions. During an appearance on the Logan Bartlett podcast, he also described the last eight months as “the most exciting eight months of my career,” explaining how AI technology has transformed the way the company operates.“Over the past 26 years, over 100 million leads never called into Salesforce due to a talent shortage,” he explained. “But now we have agency salespeople who call everyone back who contacts us.”The company uses an “omnichannel supervisor” system that coordinates collaboration between humans and AI agents, allowing the AI to know when a task requires human intervention.
IBM
IBM CEO Arvind Krishna revealed in an interview with the Wall Street Journal that hundreds of HR roles have been replaced by AI chatbots. The company eliminated marketing and communications roles and also replaced about 200 human resources positions with AI agents. Krishna said IBM is hiring in areas that require deeper critical thinking, such as engineering, sales and marketing.
