Amazon, Microsoft and extra cite AI for 2025 layoffs

Layoffs have been a defining characteristic of the job market in 2025, with a number of main firms saying 1000’s of job cuts pushed by synthetic intelligence.

In reality, AI was chargeable for virtually 55,000 layoffs within the U.S. this yr, based on consulting agency Challenger, Grey & Christmas.

There have been in whole 1.17 million job cuts via 2025, the very best stage because the Covid-19 pandemic in 2020 when there have been 2.2 million layoffs introduced by the tip of the yr.

In October, U.S. employers introduced 153,000 job cuts, and there have been over 71,000 job cuts in November, with AI being cited for over 6,000 for the month, per Challenger.

At a time when inflation bites, tariffs are including to bills, and companies want to perform cost-cutting measures, AI has offered a horny, short-term answer to the issue.

The Massachusetts Institute of Know-how launched a research in November displaying that AI can already do the job of 11.7% of the U.S. labor market and save as a lot as $1.2 trillion in wages throughout finance, healthcare, and different skilled providers.

Not everyone seems to be satisfied that AI is the actual cause behind the dramatic job cuts, as Fabian Stephany, assistant professor of AI and work on the Oxford Web Institute, beforehand advised CNBC, that it is perhaps an excuse.

Stephany mentioned many firms that carried out properly through the pandemic “considerably overhired” and the current layoffs may simply be a “market clearance.”

“It is to some extent firing those who for whom there had not been a sustainable long run perspective and as a substitute of claiming ‘we miscalculated this two, three years in the past, they will now come to the scapegoating, and that’s saying ‘it is due to AI although,'” he added.

Listed below are the highest companies that cited AI as a part of their layoff and restructuring technique in 2025.

In October, Amazon introduced the biggest ever spherical of layoffs in its historical past, slashing 14,000 company roles, because it appears to spend money on its “largest bets” which incorporates AI.

“This technology of AI is essentially the most transformative know-how we have seen because the Web, and it is enabling firms to innovate a lot sooner than ever earlier than… we’re satisfied that we have to be organized extra leanly, with fewer layers and extra possession, to maneuver as rapidly as doable for our prospects and enterprise,” Beth Galetti, senior vp of individuals expertise and know-how at Amazon, wrote in a weblog submit.

Amazon CEO Andy Jassy warned of the cuts earlier this yr, telling staff that AI will shrink the corporate’s workforce and that the tech large will want “fewer folks doing a few of the jobs which can be being achieved immediately, and extra folks doing different varieties of jobs.”

Microsoft has reduce a complete of round 15,000 jobs via 2025, and its most up-to-date announcement in July noticed 9,000 roles on the chopping block.

CEO Satya Nadella wrote in a memo to staff that the corporate wanted to “reimagine” its “mission for a brand new period,” and went on to tout the importance of AI to the corporate.

“What does empowerment appear to be within the period of AI? It isn’t nearly constructing instruments for particular roles or duties. It is about constructing instruments that empower everybody to create their very own instruments. That is the shift we’re driving — from a software program manufacturing unit to an intelligence engine empowering each individual and group to construct no matter they should obtain,” Nadella mentioned.

International tech large IBM’s CEO Arvind Krishna advised the Wall Avenue Journal in Could that AI chatbots had taken over the roles of some hundred human sources employees.

Nonetheless, in contrast to different firms that had cited AI in job cuts, Krishna admitted that the agency had elevated hiring in different areas that required extra crucial considering, similar to software program engineering, gross sales, and advertising and marketing.

In November, the corporate introduced a 1% world reduce, which may impression almost 3,000 staff.

Cybersecurity software program maker CrowdStrike mentioned in Could that it is shedding 5% of its workforce or 500 staff, and straight attributed the cuts to AI.

“AI has at all times been foundational to how we function,” co-founder and CEO George Kurtz wrote in a memo included in a securities submitting. “AI flattens our hiring curve, and helps us innovate from thought to product sooner. It streamlines go-to-market, improves buyer outcomes, and drives efficiencies throughout each the back and front workplace. AI is a drive multiplier all through the enterprise.”

In February, HR platform Workday was one of many first firms this yr to say its chopping 8.5% of its workforce, amounting to round 1,750 jobs, as the corporate invests extra in AI.

Workday CEO Carl Eschenbach mentioned the layoffs have been wanted to prioritize AI funding and to unlock sources.