The wave of white-collar layoffs sweeping through corporate America has sparked growing concern that artificial intelligence (AI) may finally be taking over office jobs.
In recent weeks, major firms including Amazon, UPS, and Target have announced tens of thousands of job cuts – together eliminating more than 60,000 positions this year, reports CNBC.
While many executives cite efficiency and new business models, critics argue that some companies are using AI as an easy scapegoat for old-fashioned cost-cutting.
Several firms have openly admitted to replacing employees with automation. Swedish fintech Klarna reduced its workforce by about 40%, crediting AI for the downsizing. Duolingo and Salesforce have also streamlined operations by assigning more tasks to AI systems.
However, experts warn that many of these “AI-driven” layoffs may be overstated. Peter Cappelli, a management professor at the Wharton School, told CNBC that implementing AI at scale is far more complex than many assume.
“There’s little evidence that AI is cutting jobs at this level,” he said, adding that many companies are simply trimming excess layers and restructuring for investor confidence.
Despite the optimism on Wall Street, the job cuts have fueled anxiety in an economy already strained by inflation, high tariffs, and slowing consumer demand. Companies across sectors are taking drastic steps to remain competitive.
Amazon, for instance, recently confirmed 14,000 corporate job cuts – the largest in its history – as part of CEO Andy Jassy’s plan to “streamline operations.” Jassy said the layoffs are aimed at reducing bureaucracy rather than directly replacing staff with AI, though the company continues to invest heavily in AI infrastructure and cloud computing.
At UPS, around 48,000 roles have been eliminated this year as the logistics giant shifts away from low-margin Amazon shipments and automates more of its operations. While AI wasn’t the main cause, future hiring will likely shrink as automation expands.
Target also announced 1,800 corporate job cuts, citing a need to simplify its structure after years of flat sales and growing costs. The retailer’s new CEO, Michael Fiddelke, said the decision will help “accelerate technology” and improve efficiency amid sluggish consumer spending.
Analysts say the trend reflects a broader “reallocation” of labor rather than a total disappearance of jobs positions are shifting from traditional corporations to emerging industries powered by AI.
Still, with more layoffs looming and companies racing to cut costs, experts warn the US may be entering the early stages of an AI-influenced white-collar recession.
