The AI Layoff Excuse Is Now a Corporate Standard

Two weeks ago I wrote about Cognizant's 'AI-led restructuring,' a phrase that sounded like it had been generated by a parody algorithm. Last week it was Cloudflare invoking the 'agentic AI era' to justify 224 redundancies. Now, in a development so unsurprising it barely qualifies as news, Cisco and Block are pointing to artificial intelligence when announcing layoffs, while LinkedIn is cutting five percent of its workforce in a 'reorganisation' that conveniently coincides with twelve percent revenue growth. The AP News report confirms what regular readers of this column already know: AI has become the corporate equivalent of 'restructuring for efficiency' — a catch-all euphemism that makes the technology sound powerful and workers sound expendable, while allowing executives to avoid mentioning the real drivers: shareholder pressure, cost-cutting targets, and the quarterly earnings call.

Cisco's CEO said the company must make 'hard decisions' to invest in AI. This is the same script that Cognizant and Cloudflare used, word for word. It is a script that has now been deployed so many times that one begins to suspect the tech industry has a shared document somewhere, a Google Doc titled 'Layoff Announcement Template v5.2' with placeholders for '[Company Name]' and '[Buzzword of the Month].' The substitution of 'AI' for 'cost-cutting' is not merely dishonest; it is insulting to the workers who are told their jobs are being automated away when in fact the company just wants to trim headcount while keeping the stock price aloft.

The numbers tell the story. Cisco, Block, and LinkedIn are all reporting healthy revenue growth. None of them claim that AI has actually replaced the specific roles they are cutting, because it hasn't. As analysts note in the AP report, the current wave of layoffs often coincides with broader cost-saving measures and shareholder demands, rather than immediate AI replacement of workers. The technology is still too unreliable, too prone to hallucination, and too dependent on human oversight to function as a genuine substitute for most white-collar labour — as Axios reported this week in a separate piece about the 'significant human expertise' still required to run AI cybersecurity tools. The discrepancy between the hype and the reality is so wide that you could drive a truck through it, which is precisely what executives are doing.

This is the pernicious brilliance of the AI layoff excuse: it lets companies have it both ways. They can claim to be on the cutting edge of a transformative technology (excitement! future-proofing!) while simultaneously using that same technology as a cudgel against their workforce (efficiency! hard decisions!). The same CEO who gives a keynote about how AI will create a golden age of abundance will turn around and tell employees that their jobs are being eliminated because AI demands it. The contradiction is so blatant that it would be funny if it weren't happening to real people.

Meanwhile, the national security establishment is busy framing AI as a race against China, with Treasury Secretary Bessent declaring that 'we are in the lead' and Anthropic publishing policy papers about securing a one- to two-year advantage. Perhaps that is true. But the lead in what, exactly? In using AI as a pretext for layoffs? In creating a technology that is powerful enough to terrify policymakers but not reliable enough to replace the workers who are being let go? The disconnect between the grand strategic narrative — 'AI will remake the world, and we must win the Cold War 2.0' — and the petty reality — 'AI is just a convenient excuse to cut 875 people at LinkedIn' — is becoming impossible to ignore. If AI is genuinely as transformative as its proponents claim, it should be creating more value, not more excuses.

The pattern will not stop until investors stop rewarding it. So long as a company's stock rises by a few points after a layoff announcement, the euphemism will persist. AI will continue to be blamed for cuts that have nothing to do with technological capability and everything to do with the quarterly report. I have run out of ways to express my contempt for this practice, and I suspect the workers on the receiving end have run out of patience. The next time a CEO stands up and says 'AI made us do it,' do not ask whether the technology is ready. Ask whether the CEO is ready to tell the truth.