Grads Get Rude Welcome from Job Market Battered by AI-Fueled Tech Layoffs

New grads are about to enter a workforce where companies are replacing human intelligence with artificial intelligence. 

Meta employees stuffed their bags full of kombuchas and chargers this week before mass layoffs went down Wednesday. The social media giant let go 10% of its employees and is moving another 7,000 folks into AI-focused roles. Cisco said last week it plans to slash 4,000 jobs as it focuses spending on AI, while Microsoft reportedly made ~7% of its employees eligible for voluntary buyouts last month. Block laid off 40% of its employees in February, and CEO Jack Dorsey said Tuesday he wants the company to cut more layers from its organizational structure. 

Oracle, Amazon and Coinbase have also made major layoffs this year as tech-sector job cuts surge past 111,000, according to Layoffs.fyi. 

AI’s Funny Selfie Phase Is Over

AI entered the zeitgeist as a fun way to create inedible recipes and anime-ified selfies. But with companies spending hundreds of billions on building the tech, it was bound to get serious. And as companies keep shedding roles both to fund AI and because of AI-driven efficiencies, the outlook for jobs could shift dramatically: 

• The college-degree-to-office-job pipeline is over, according to recruiting firm Randstad, which found jobs in specialized trades are experiencing wage growth competitive with office work (up 30% in the US over the past four years). In another sign of an AI-driven shift away from the office, Standard Chartered’s CEO said his bank’s mass layoffs would replace “lower-value human capital” with AI (before he walked back the comment). Anthropic’s CEO said this year that AI could see GDP climbing (by his guess) 5% to 10% while unemployment reaches 10%. 
• Other executives say AI costs more than human labor as spending on AI-powering tokens outstrips workers’ rates. At the same time, Randstad’s data found that graduates who can master AI can command higher salaries, and demand has risen for job applicants who bring emotional intelligence and creativity. One major employer survey found junior-level hiring is set to increase. 

Building Backlash: As layoffs mount, sentiment toward AI is shifting faster than ChatGPT can say, “You’re absolutely right!” Several commencement speakers mentioned AI and were quickly booed by jaded graduates. Reese Witherspoon encountered backlash for her post last month saying women should learn more about AI. Community organizations, meanwhile, delayed or blocked at least $156 billion worth of data-center projects last year, Data Center Watch found, as AI demands more power.