'AI-washing' and 'forever layoffs': Why companies keep cutting jobs, even amid rising profits | Fortune
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'AI-washing' and 'forever layoffs': Why companies keep cutting jobs, even amid rising profits | Fortune
"In many industries, AI is far from delivering on its promises of massive productivity gains that make humans obsolete. But one thing is clear: The technology is absolutely terrifying workers. A survey of nearly 5,000 Americans this summer found that 71% of them are worried that artificial intelligence will put too many people out of work permanently. Those concerns reflect what companies are saying: About 40% of employers expect to cut their workforces in response to AI automating tasks."
"Of the 1.2 million job cuts U.S. companies announced in 2025-yes, nearly twice 2024's total-AI was mentioned as a reason for just 55,000, or 4.5%, of them, according to research firm Challenger, Grey & Christmas. And in some cases the connection to AI might be exaggerated: Companies may make vague gestures toward the rise of AI as a way to justify layoffs undertaken for other reasons, or do layoffs in premature anticipation of AI efficiency gains-practices that market research firm Forrester recently dubbed "AI-washing.""
"And indeed, some of the biggest rounds of layoffs so far this year-1,700 at Dutch semiconductor supplier ASML and 14,000 at Amazon-do not appear to be due directly to AI automation, but rather boring business basics like trimming corporate bloat, at companies reporting healthy growth. That's not particularly reassuring to workers. The drip, drip, drip of layoffs at increasingly profitable companies like ASML and Amazon can ruin morale among remaining workers and contribute to a growing sense that-because of AI or not-no one's job is safe."
Many workers fear AI will cause mass unemployment, with a survey finding 71% of nearly 5,000 Americans worried about permanent job losses and about 40% of employers expecting AI-driven cuts. However, of 1.2 million job cuts announced in 2025, AI was cited in only 55,000 (4.5%), per Challenger, Grey & Christmas. Some companies invoke AI vaguely or prematurely to justify layoffs, a practice Forrester calls "AI-washing," and a Yale Budget Lab report finds major AI-driven job disruption remains largely speculative. Large recent cuts at ASML and Amazon appear tied to trimming corporate bloat, yet ongoing layoffs harm morale and increase job insecurity.
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