Big Tech slashes jobs despite record profits, blaming AI

What happened

Amazon, Microsoft, Meta, and Oracle have announced major layoffs. US tech companies announced 38,242 job cuts in May, the biggest month for headcount reductions in two years. Headcount at Apple, Meta, Google, Microsoft, and Amazon has been effectively flat since 2022. Oracle disclosed it cut 21,000 jobs in the last year, citing AI adoption; Block cut 40% of staff in February, saying AI had "changed what it means to build and run a company."

Why it matters

Tech companies are deploying AI to accomplish more with less staff, even as business profits remain at record highs. Meta's chief technology officer recently acknowledged that morale is "probably one of the worst it's ever been." Job insecurity is creating an environment of fear, with workers reporting overwork and low morale on industry discussion platforms. This signals that major employers view AI-driven automation as a way to reduce headcount regardless of financial health.

What to watch

Growing job insecurity at Silicon Valley's largest employers may reshape the sector's reputation as a stable career destination. Workers across the industry are increasingly discussing layoffs and job security rather than compensation and career growth, marking a significant shift in workplace sentiment.