Amazon’s recent decision to cut thousands of corporate jobs has intensified fears that AI is replacing human workers. While companies like Chegg, Salesforce, and UPS cite AI as a factor in layoffs, experts argue broader economic trends and overhiring during the pandemic also play major roles. Studies show AI’s impact varies by job type—administrative roles appear more affected than technical ones. Analysts warn against overstating AI’s role, noting that typical business cycles and interest rate changes remain key drivers of job cuts.
AI Blamed for Job Cuts — But Is It the Whole Story?
Amazon’s decision this week to cut thousands of corporate positions has reignited long-standing fears that Artificial Intelligence is starting to replace human workers.
The tech giant joins a widening list of U.S. companies citing AI technology as a contributing factor behind recent layoffs.
Yet, some experts argue that AI may not be entirely responsible. They caution against drawing sweeping conclusions from high-profile job cuts that may not accurately reflect the technology’s broader impact on employment.
Chegg, an online education company, referred to the “new realities” of AI while announcing a 45% workforce reduction on Monday. Last month, Salesforce eliminated 4,000 customer service roles, with its CEO explaining that AI agents had begun handling much of the same work.
UPS, meanwhile, disclosed on Tuesday that it has shed 48,000 jobs since last year. The company’s chief executive previously attributed part of these redundancies to advances in machine learning.
But interpreting executive comments during layoffs as evidence of AI’s impact is “possibly the worst way” to assess the technology’s effect on jobs, according to Martha Gimbel, executive director of the Budget Lab at Yale University. She noted that company-specific dynamics often play a larger role.
“There’s a real tendency, because everyone is so alarmed about AI’s potential effects on the labor market, to overreact to each company announcement,” Gimbel said.
Some groups of workers—such as recent college graduates and data center employees—are particularly exposed to the technology’s adoption.
A study by the Federal Reserve Bank of St. Louis recently found a link between jobs with greater AI exposure and rising unemployment rates since 2022.
However, research by Morgan Frank, an assistant professor at the University of Pittsburgh, paints a more nuanced picture. His analysis suggests that the only workers notably affected by ChatGPT’s launch in November 2022 were those in office and administrative support. Their unemployment claims spiked in early 2023, immediately following the chatbot’s release.
For computer and math professionals, by contrast, “there is no discernible change in the trend around the launch of ChatGPT,” Frank said.
“Both tech workers and administrative staff are facing a tougher job market than they did a few years ago,” he added. “But I’d be skeptical that AI is the main reason for all of it.”
Experts note that Amazon and other major tech firms expanded rapidly in the years leading up to—and during—the early stages of—the pandemic, when U.S. interest rates were near zero. That aggressive hiring spree made eventual job cuts inevitable, independent of the recent AI boom.
The Federal Reserve also began raising rates around the same time ChatGPT debuted, adding another layer of complexity to the employment picture.
“A lot of this feels different to people simply because the phrase ‘AI’ is attached to it,” Gimbel said. “But so far, nothing I’ve seen deviates from the typical patterns of company hiring and firing—especially at this stage of the economic cycle.”
She emphasized that future hiring behavior during economic recovery phases will be key to understanding AI’s true role. In the long run, analysts will need to separate cyclical job losses from those caused by technological disruption.
If the U.S. were to enter a recession, Gimbel noted, positions in human resources and marketing would likely be the first to go—roles that also happen to be vulnerable to automation, complicating efforts to pinpoint whether the cuts are AI-related or macroeconomic.
Amazon, which confirmed plans to eliminate about 14,000 corporate jobs, said it must operate “more leanly” to take full advantage of opportunities created by AI.
Despite the cuts, the company continues to perform strongly. In July, it reported quarterly results exceeding Wall Street expectations, including a 13% year-on-year sales increase to $167.7 billion (£125 billion).
Enrico Moretti, an economics professor at the University of California, Berkeley, said that major tech players like Amazon are at the forefront of AI-related job shifts because they are both creators and consumers of the technology.
Still, he acknowledged that the firm’s latest reductions likely also reflect a natural correction after its pandemic-era hiring surge.
According to Lawrence Schmidt, associate professor of finance at MIT’s Sloan School of Management, Amazon’s massive scale gives it the ability to automate roles faster than many competitors.
“It’s not unreasonable to think Amazon might want to cut or avoid adding certain positions that can be easily automated,” Schmidt said.
“Regardless of the overall job count,” he added, “some degree of reallocation is inevitable.”