Is AI going to take away jobs? Spoiler alert: It already is. In fact, AI has already been eating jobs away in thousands every month since 2023. The bigger layoffs from Microsoft and Intel have only shed light on the gravity of the situation lately, but companies aren’t backing out anytime soon.
A new report from the outplacement firm Challenger, Gray, and Christmas indicates that artificial intelligence is already causing thousands of job displacements monthly, which is contributing to broader challenges in the US labour market. The increasing adoption of generative AI technologies by private employers led to over 10,000 job cuts in July 2025 alone.
According to the firm, AI has emerged as one of the top five reasons for job losses this year, with a staggering over 27,000 job cuts directly attributed to AI since 2023. The technology industry has been particularly hard hit, experiencing a significant reduction in the human workforce.
AI job cuts have significant impact on overall job market
The impact of AI-driven automation is notably more severe among younger job seekers, with data showing a 15 percent decline in entry-level corporate roles over the past year. While some corporate executives have openly acknowledged AI’s potential to reduce workforces, experts also suggest that the technology is having an indirect effect on the job market. This includes urging companies to prioritise cost-cutting measures and invest in AI software solutions rather than expanding their human workforce, all in a bid to prepare for the economic uncertainties lying ahead.
Tech firms hit the most in 2025
Adding to the shifting landscape, major tech giants have continued significant workforce reductions in 2024 and 2025. Microsoft, for instance, has undertaken aggressive ‘restructuring,’ axing over 15,000 jobs in the first seven months of 2025. The layoffs at Redmond are largely linked to an $80 billion investment in AI infrastructure and efforts to “flatten” the organisation by removing management layers.
Similarly, India’s largest IT services firm, Tata Consultancy Services (TCS), plans to reduce its global workforce by 2% (over 12,000 employees) in the current financial year. The layoff is said to primarily impact middle and senior management, citing the urge to become a “future-ready organisation” and addressing “skill mismatches” amidst AI deployment.
This wave of layoffs across companies like Intel, IBM, Amazon, and Google highlights a broader industry trend of re-evaluating workforce needs in response to economic conditions and the promise of AI technologies.