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 asserting hundreds of job cuts pushed by synthetic intelligence.

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

There have been in complete 1.17 million job cuts by 2025, the best degree 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 gorgeous, short-term resolution to the issue.

The Massachusetts Institute of Know-how launched a research in November exhibiting 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 companies.

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 informed CNBC, that it could be 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 folks that for whom there had not been a sustainable long run perspective and as an alternative 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 seems to spend money on its “largest bets” which incorporates AI.

“This technology of AI is essentially the most transformative expertise 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 potential for our prospects and enterprise,” Beth Galetti, senior vice chairman of individuals expertise and expertise 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 big will want “fewer individuals doing a number of the jobs which might be being finished immediately, and extra individuals doing different forms of jobs.”

Microsoft has lower a complete of round 15,000 jobs by 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 facility to an intelligence engine empowering each individual and group to construct no matter they should obtain,” Nadella mentioned.

World tech big IBM’s CEO Arvind Krishna informed the Wall Avenue Journal in Could that AI chatbots had taken over the roles of some hundred human sources staff.

Nonetheless, not like different firms that had cited AI in job cuts, Krishna admitted that the agency had elevated hiring in different areas that required extra crucial pondering, comparable to software program engineering, gross sales, and advertising and marketing.

In November, the corporate introduced a 1% world lower, which may influence 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 all the time 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 concept to product sooner. It streamlines go-to-market, improves buyer outcomes, and drives efficiencies throughout each the back and front workplace. AI is a pressure 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 liberate sources.