As layoffs continue to roll out across the corporate world, new data suggests there may be an external force influencing the thousands of job cuts. In January, layoffs totaled 82,307, a 136% increase from December; in February, companies have continued to announce more cuts ready to be conducted in the near future, with Snap, UPS, and Google leading the stage recently. Although a large segment of these lean labor tactics could be attributed to the current higher monetary policy, there are some cases that may have another culprit. Currently, generative AI is a very small contributor to losses in white-collar jobs, but other AI applications and machine-learning tools have been associated with replacement in the labor market.
At the beginning of January, the popular language learning app Duolingo cut 10% of its workforce as the company shifted heavier investment into artificial intelligence. Two weeks ago, UPS announced layoffs of 12,000, shortly coinciding with the firm’s push for machine learning in its pricing department. Since last year, there have been a total of 4,600 corporate layoffs where companies have directly associated links to AI investment. However, this number could be much higher as several companies may not have reported adoptions of AI in their layoff announcements. During the same period, AI has continued to boost productivity alongside the roles of different jobs in the nation. For those who had adopted AI, productivity was reported to soar in white-collar workers and blue-collar workers by 65% and 54%, respectively. As the year continues, investors could pay close attention to layoff announcements to see whether a trend of AI adoption could be a new contributing factor.
