Tech companies once blamed layoffs on overhiring and market shifts鈥攏ow it鈥檚 AI.
Recent statements from firms like Amazon, Shopify, British Telecom, Duolingo, and Klarna suggest that automation is reducing demand for human workers. As these companies pour heavily into AI, they鈥檙e simultaneously streamlining costs mostly through layoffs. In 2024, 549 tech firms laid off approximately 152,000 employees, according to Layoffs.fyi.
At the same time, many CEOs are championing 鈥淎I-first鈥 strategies and touting productivity gains. But the workforce may not be ready, with only 62% of employees having received any AI-related training, even as companies push to scale AI across their operations, according to Gartner.
鈥淲e鈥檙e at this moment where making big statements is about getting attention and drawing focus to the fact that AI is being used for real business impact,鈥 Gartner vp analyst Nicole Greene told ADWEEK. 鈥淩ather than the tangible, long-term conversation around what does it really look like to re-skill and up-skill talent for a modern workforce.鈥
Former Publicis chief strategist and growth officer Rishad Tobaccowala said the shift is also about rebalancing power. Companies may need 20% to 25% fewer people for the same output, he said, but that future will rely on a new kind of worker, one who can collaborate with AI.
鈥淧eople are talking about AI strategy鈥 that鈥檚 the stupidest thing in the world,鈥 he said. 鈥淵ou need to figure out how your entire strategy is changed because of AI.鈥
Here鈥檚 what company leaders have said publicly about how they believe AI will impact their workforce, in alphabetical order.
Action: Since 2022, Amazon has laid off more than 27,000 employees across multiple divisions. While the company initially cited macroeconomic uncertainty, recent statements from leadership suggest AI is becoming a key factor in how it envisions future staffing.
What it said: In a June blog post, CEO Andy Jassy pointed to the company鈥檚 deep investment in generative AI鈥攈ighlighting over 1,000 services and applications in progress鈥攁nd signaled a shift in how work gets done. 鈥淎s we roll out more generative AI and agents,鈥 he wrote, 鈥渋t should change the way our work is done鈥 [and] we鈥檒l need fewer people doing some of the jobs that are being done today.鈥 While Jassy didn鈥檛 specify which roles would be affected, he noted that the company expects to see workforce reductions in the coming years as it leans into AI-driven efficiency.
Jassy also pointed to advertising as a clear example of AI integration, citing Amazon鈥檚 suite of tools that help brands plan, onboard, create, and optimize campaigns, used by over 50,000 advertisers in Q1.
British Telecom
Action: British Telecom plans to cut 55,000 jobs by 2030, roughly 40% of its 130,000-person workforce. Of those, at least 10,000 roles could be replaced by AI, according to The Financial Times.
What it said: CEO Allison Kirkby told FT the company is exploring the full impact of AI and suggested that, 鈥渄epending on what we learn from AI鈥夆 there may be an opportunity for BT to be even smaller by the end of the decade.鈥 The company has already begun integrating generative AI into customer-facing roles, including sales and support operations.
Action: Cut around 10% of its contractor workforce in 2023, as it turns to AI models like OpenAI鈥檚 GPT-4 to streamline content production and translations.
What it said: CEO Luis von Ahn has positioned the company as 鈥淎I-first,鈥 saying that achieving that vision means rethinking 鈥渕uch of how we work,鈥 and 鈥渕aking minor tweaks to systems designed for humans won鈥檛 get us there.鈥 As part of the shift, Duolingo is placing 鈥渃onstructive constraints鈥 on hiring: headcount will only be approved if a team 鈥渃annot automate more of their work.鈥 The company is also experimenting with AI in hiring and performance reviews.
Action: Klarna has reduced its workforce by about 40%, with CEO Sebastian Siemiatkowski telling CNBC in May that the cuts are largely due to AI. The Swedish fintech company previously said it planned to shrink its headcount from 3,800 to 2,000 employees over the next few years. The company posted a $99 million loss in Q1, attributing it to one-off costs related to depreciation, share-based payments, and restructuring.
What it said: In marketing specifically, CMO David Sandstr枚m told ADWEEK that team size reductions were driven in part by the growing capabilities of generative AI, and that further cuts could follow as the technology evolves.
Action: Shopify has trimmed its workforce in the last two years, first by 14% in 2022, followed by another 20% in 2023. The company ended 2024 with 8,100 employees, down from 8,300 the previous year, per the company鈥檚 filing.
What it said: In a memo to employees, which CEO Tobi L眉tke posted on X, Shopify laid out a new baseline: 鈥淩eflexive AI usage,鈥 in other words, all staffers tinkering with AI, is now expected across the company. Teams requesting headcount must first explain why the work can鈥檛 be done with AI. 鈥淲hat would this area look like if autonomous AI agents were already part of the team?鈥 L眉tke wrote. The company also said it plans to add AI-related questions to its performance and peer review processes.