Artificial intelligence (AI) has entered nearly every aspect of our lives, and now, it’s being blamed for people losing their jobs. But is AI really behind these layoffs, or has it become a convenient scapegoat for tech CEOs?
According to a BBC report, words like efficiency, over-hiring, and too many management layers are now outdated, and most of the job cut explanations stem from artificial intelligence.
Tech companies announce layoffs
In the past few weeks, tech giants, including Amazon, Google, Meta, and smaller companies like Pinterest and Atlassian, all announced or warned of plans to reduce the workforce, indicating that the latest developments in AI, according to them, are now letting the companies do more with fewer people.
Earlier this year, Meta’s Chief Executive Officer, Mark Zuckerberg, announced, “I think that 2026 is going to be the year that AI starts to dramatically change the way that we work.” In the three months’ time, Meta, which owns Facebook, Instagram, and WhatsApp, has handed pink slips to hundreds of people. This includes the 700 who were fired just last week. According to a Business Insider report, the global cuts affected employees in Reality Labs, Facebook, recruiting, sales, and global operations.
The layoffs came after Reuters in February reported that Meta is planning to axe 20% of its workforce to offset costly AI infrastructure bets and prepare for greater efficiency brought about by AI-assisted workers. However, the company is also planning to double down its AI spending this year, and is still hiring in “priority areas.”
Jack Dorsey on cutting workforce
Apart from Zuckerberg, Jack Dorsey, the head of financial technology firm Block Inc, has been unusually direct about his intentions. Speaking to shareholders last month, as the company, known for platforms like Cash App, Square, and Tidal, announced plans to cut nearly half its workforce, he stressed that the move was not purely about improving efficiency.
He argued that advances in “intelligence tools” are reshaping how companies are built and operated, suggesting that much smaller teams can now achieve better results using such technology. Dorsey added that he believes most companies will reach a similar conclusion within the next year, noting that he wanted to act early.
Blaming cuts on AI better than citing cost pressures: Tech investor
However, according to tech investor Terrence Rohan, explaining cuts by highlighting advances in AI is much better than citing cost pressures or a desire to please shareholders.
He told BBC, “Pointing to AI makes a better blog post,” and added, “Or it at least doesn’t make you seem as much the bad guy who just wants to cut people for cost-effectiveness.”
Tech giants ramp up AI spending
Another way that AI is now driving job cuts is through increased spending in technology. The report suggests that collectively, the tech giants are planning to inject $650 billion in the coming year. Earlier in February, Amazon executives said the company aims to spend over $200 billion over the coming year on investments in AI, the maximum out of all the major tech giants.
