The year 2025 will be remembered as the moment when artificial intelligence (AI) stepped out of the shadows and became a publicly acknowledged driver of mass job reductions in the global technology sector. While economic pressures persisted, this year marked a significant shift as several industry giants openly linked workforce reductions to their accelerating adoption of AI and automation, moving beyond vague references to 'economic uncertainty'.
The Unmistakable AI Factor in Global Layoffs
According to a report by the consulting firm Challenger, Gray & Christmas, AI was directly behind layoffs affecting at least 55,000 people in the United States in 2025. The trend intensified in the latter part of the year. CNBC reported that US companies laid off around 153,000 employees in October and another 71,000 in November, with AI cited as a factor for at least 6,000 of those job eliminations.
This represents a clear departure from 2024, where companies were hesitant to explicitly tie job cuts to AI. A recent MIT study underscores the potential scale of this shift, suggesting AI tools can already perform the work of 11.7% of the US labour market, potentially saving up to $1.2 trillion in wages across finance, healthcare, and professional services.
Major Tech Firms Point to AI
The list of companies attributing layoffs to AI adoption reads like a who's who of the tech world.
Amazon confirmed in October that it would cut at least 14,000 jobs, with more expected in 2026. This move is set to impact at least 1,000 Indian employees. Senior Vice President Beth Galetti stated the need to be organized "more leanly" in the era of "the most transformative technology we’ve seen since the Internet." CEO Andy Jassy had earlier warned that AI would shrink the workforce, requiring fewer people for certain tasks.
Microsoft reportedly eliminated a total of 15,000 jobs in 2025, including 9,000 roles announced in July. CEO Satya Nadella spoke of "reimagining" the company's mission for the AI era, shifting from a "software factory to an intelligence engine." While hinting at future hiring, Nadella clarified that new headcount would come with "a lot more leverage" due to AI.
Salesforce cut around 4,000 customer service roles, with CEO Marc Benioff stating AI agents had taken over much of the workload. He revealed that AI was already handling up to 50% of the work in some areas, allowing a reduction from 9,000 to about 5,000 heads for certain functions.
IBM announced in November it would let go of a "low single-digit percentage" of its global workforce of 270,000. CEO Arvind Krishna had earlier told the Wall Street Journal that AI chatbots had replaced a few hundred HR roles, even as hiring increased in areas like software engineering.
Other firms like Crowdstrike (laying off 5% of its workforce), Intel (planning up to 24,000 cuts), and Duolingo also directly cited AI and automation as reasons for reducing human roles.
The Silent Layoffs in India's IT Sector
The impact was felt acutely closer to home. India's IT services sector, a traditional employment powerhouse, experienced 'silent layoffs' amid rapid AI adoption and ongoing economic uncertainty in key markets like the US.
In a significant move, industry bellwether Tata Consultancy Services (TCS) laid off 12,000 employees, representing 2% of its global workforce. The cuts notably impacted mid and senior-level professionals. While the company framed this as part of building a "future-ready generation" through "skilling and redeployment," it occurred squarely within the context of fast-paced AI integration.
The narrative in 2025 has decisively changed. AI is no longer just a futuristic promise of productivity; it is a present-day rationale for workforce restructuring. As companies globally, including in India, race to harness its power, the redefinition of roles and the human cost of this technological leap have taken center stage.
