AI-related layoffs keep coming. But there's more to the story

"In 2025, employers cited artificial intelligence as the rationale for nearly 55,000 layoffs at companies like Amazon and Microsoft. And with the new year barely underway, we're already seeing a new crop of AI-related job cuts. Citigroup is cutting over a thousand jobs, according to Bloomberg, and in a memo this week, CEO Jane Fraser warned of more layoffs later this year. "Over time, we can expect automation, AI and further process simplification to reshape how work gets done," she added."

"But there is little evidence that automation is displacing workers en masse just yet-or even drastically changing how businesses operate. According to a recent analysis by the Brookings Institution and the Budget Lab at Yale University, the proportion of workers in jobs that are ripe for AI disruption has remained steady since ChatGPT launched in 2022. What's more, there are all kinds of forces shaping the labor market right now, including changes in immigration policy that have curbed employment growth."

""What we're seeing overall right now is consistent with a labor market that has been hit with a lot of uncertainty in the macroeconomic environment," says Martha Gimbel, executive director of the Budget Lab. "The immigration changes are making it really hard to interpret changes in the jobs numbers. And if you look for any signs of changes that seem to be due to AI, those are not yet showing up.""

Employers attributed nearly 55,000 layoffs in 2025 to artificial intelligence at firms including Amazon and Microsoft, and new AI-related cuts began early in the year. Citigroup announced over a thousand job cuts and warned of more, while Meta cut about 1,500 virtual reality roles to shift investment toward AI. Analysis from Brookings and the Budget Lab finds the share of workers in roles vulnerable to AI has remained steady since ChatGPT launched in 2022. Immigration policy changes and broader macroeconomic uncertainty have affected employment growth. Labor productivity rose 4.9% in Q3 2025, and some economists link that spike to AI adoption despite limited evidence of mass displacement.

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