US Tech Sector to Cut 120,000 Jobs in 2025... Accelerating AI-Centric Restructuring

US tech companies are undertaking extensive workforce optimization, cutting a total of 127,000 jobs as they shift their business core towards artificial intelligence (AI). Overstaffing following rapid growth and concerns over economic recession have been cited as the primary drivers behind these layoffs.

Atlassian laid off 1,600 employees, approximately 10% of its workforce, to focus on AI investments, while Amazon reduced staff by 100 due to the discontinuation of its Blue Jay robot project. Salesforce and Alphabet, Google's parent company, attributed their cuts to rapid past growth and significant hiring increases, whereas startups cited difficulties in securing funding as reasons for layoffs.

Projections also indicate that the expansion of AI automation will lead to large-scale workforce reductions. Fintech firm Block announced plans to cut half its workforce, citing the proliferation of AI automation. ServiceNow's CEO warned that AI adoption could push the unemployment rate for new college graduates into the 30% range. Amazon's CEO predicted that AI integration would result in a reduction of corporate workforces.

This trend has also impacted unemployment projections. The Federal Reserve Bank of New York forecasts the unemployment rate for college graduates to be around 5.7% by the end of 2025, with an underemployment rate of 42.5%.