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Thousands of workers across major corporations like Amazon, UPS, and Target are facing layoffs as economic uncertainty continues to grip global markets. Despite speculation that artificial intelligence (AI) might be replacing workers, experts and executives say that’s not the real reason behind the cuts.ALSO READ: What does 67 mean, who made the 67 meme and why is it so popular? Why are big companies cutting jobs now? Layoffs have hit some of the biggest names in business, Amazon, UPS, Target, and more, leaving thousands of workers affected. Amazon announced it would trim about 14,000 corporate roles, prompting questions about whether AI is making workers obsolete. But CEO Andy Jassy dismissed that notion.ALSO READ: Erika Kirk and JD Vance hug goes viral - users call it the biggest scandal, ‘The VP, the widow, and the hair touch'Live Events Jassy explained that the move “was not really financially driven, and it’s not even really AI driven, not right now, at least.” Instead, he attributed the cuts to company culture and overexpansion. “If you grow as fast as we did for several years, the size of businesses, the number of people, the number of locations, the types of businesses you’re in, you end up with a lot more people than what you had before, and you end up with a lot more layers,” he said. Economists agree that this trend is not necessarily a reflection of AI’s rise. “If we take a look at Amazon, we know they hired very aggressively between 2017 and 2022, adding tons of workers during the pandemic, so I’m not surprised that there’s been a correction there,” said Timothy DeStefano, a professor of economics at Georgetown University. “I personally don’t think there’s any connection between these layoffs and AI.” Is AI actually replacing jobs yet? Despite heavy investment in artificial intelligence, there’s little evidence that it’s causing mass job losses. Goldman Sachs surveyed more than 100 of its bankers and found “only 11% of US companies are actively reducing headcount due to AI,” suggesting that widespread displacement hasn’t yet begun. “These results support our longstanding view that AI will mostly be a productivity- and revenue-enhancing technology,” Goldman Sachs economists noted, adding that its impact on employment remains “limited outside of a few specific sectors like tech.” Still, some companies like Chegg and Salesforce have acknowledged AI’s growing influence on their operations, with both firms citing efficiency improvements as reasons for workforce reductions, as quoted in a report. What are other major firms doing? The wave of layoffs is not isolated to Amazon. UPS revealed it had already cut about 34,000 operational jobs in the first nine months of the year, along with another 14,000 management roles. Target plans to eliminate 1,800 corporate positions as part of a restructuring effort.ALSO READ: Royal cover-up? Palace downplays King Charles’ cancer as funeral plans surface Media giant Paramount Skydance is also preparing to slash around 1,000 positions, with another 1,000 expected to follow, according to reports. Even Meta, considered one of the biggest winners in the AI-driven economy, has made job cuts, including within its AI unit. Electric vehicle maker Rivian is similarly implementing reductions. What does this mean for the labor market? The U.S. labor market, once roaring, is showing signs of strain. Job postings in tech and mathematics, which peaked in 2022, have dropped 36% below pre-pandemic levels, according to Indeed. “The earlier hiring boom, broader economic conditions, and interest in AI could explain this year’s crash in demand for tech workers,” the company said. While layoffs remain relatively stable, the job market has cooled, with young professionals feeling the pinch. Matthew Bidwell, a management professor at the University of Pennsylvania’s Wharton School, told Yahoo Finance, “I think layoffs are a bad thing, and they’re particularly bad for the people involved. But they’re also part of the capitalist process of creative destruction, companies will invest in building businesses in certain areas, and over time those businesses will turn out not to work or to be obsolete.”ALSO READ: Government shutdown news: Brace yourself as Thanksgiving flights could face unprecedented chaos across US He added that while “there are early signs that AI may be starting to affect the labor market,” these recent layoffs “are not where we’re seeing it so far.” While artificial intelligence continues to reshape industries, the recent wave of corporate layoffs appears driven by something far more familiar, economic correction, cost-cutting, and the enduring cycle of corporate restructuring. FAQsAre recent layoffs at Amazon and other companies caused by AI?Executives and experts say the cuts are due to restructuring, efficiency measures, and overexpansion, not AI.Which major companies have announced job cuts recently?Amazon, UPS, Target, Meta, Paramount, and Rivian are among those reducing their workforces in recent months.Add as a Reliable and Trusted News Source Add Now! (You can now subscribe to our Economic Times WhatsApp channel) Read More News onAmazon layoffsTarget layoffsAI impact on jobsUPS job cutscorporate restructuringmass layoffs hit amazonAmazon UPS and Target layoffs (Catch all the US News, UK News, Canada News, International Breaking News Events, and Latest News Updates on The Economic Times.) Download The Economic Times News App to get Daily International News Updates....moreless (You can now subscribe to our Economic Times WhatsApp channel)Read More News onAmazon layoffsTarget layoffsAI impact on jobsUPS job cutscorporate restructuringmass layoffs hit amazonAmazon UPS and Target layoffs(Catch all the US News, UK News, Canada News, International Breaking News Events, and Latest News Updates on The Economic Times.) Download The Economic Times News App to get Daily International News Updates....moreless Explore More Stories123
