Corporate attitudes toward discussing artificial intelligence's role in workforce reductions are shifting dramatically. After initially avoiding the topic, major companies across multiple industries are now openly attributing job cuts and hiring freezes to AI implementation.
Global Companies Point to AI in Workforce Reductions
In a significant trend developing through late 2023, several prominent international corporations have explicitly linked workforce changes to artificial intelligence. German airline Deutsche Lufthansa AG announced in late September plans to eliminate 4,000 administrative positions by 2030, specifically citing "the increased use of artificial intelligence" as a contributing factor.
Weeks later, Dutch banking giant ING Groep NV revealed that approximately 1,000 positions faced risk due to "digitalization, AI, and evolving customer needs." The pattern continued in November when South Korean video game company Krafton Inc. announced a hiring freeze to focus on an "AI-first" approach to game development.
The Numbers Behind AI-Related Job Cuts
The scale of AI's impact on employment is becoming quantifiable. According to outplacement firm Challenger, Gray & Christmas, AI has been cited for 48,414 job cuts announced in the United States so far this year. The trend accelerated sharply in October alone, with 31,039 AI-related job cuts announced during that single month.
This sudden uptick represents roughly one-fifth of all planned layoffs in the U.S. last month, catching the attention of policymakers including Federal Reserve Chair Jerome Powell. The phenomenon has ignited debate about whether companies are genuinely transforming operations through AI or simply using the technology as justification for cuts driven by broader economic concerns.
Corporate Motivations: Efficiency or Excuse?
Experts suggest the reality may involve both genuine transformation and strategic messaging. George Denlinger, an operational president at staffing agency Robert Half, notes that many companies, particularly in tech, "overexpanded during the post-pandemic boom and ended up with very large labour forces."
Denlinger describes how some companies engage in what he calls "AI-washing": "They talk about using AI to do those jobs in the future, which can amount to a kind of 'AI-washing.' They blame AI even though it is not the only reason layoffs are happening."
The mixed motivations appear even within individual companies. Amazon CEO Andy Jassy signaled in June that the company's workforce would decline as AI handles more tasks. However, when announcing 14,000 job cuts in October, Jassy clarified the move was "not even really AI driven, not right now," instead attributing it to bureaucratic bloat.
As companies navigate uncertain global economic conditions marked by tariffs, trade wars, and shifting consumer sentiment, artificial intelligence has become both a practical tool for efficiency and a convenient explanation for workforce adjustments that appeal to investors seeking leaner operations.
