By Callum Borchers
Peter Bell is the founder of Gather.dev, a professional network for chief technology officers, who uses AI agents in place of people for certain roles at his startup.
He has gone so far as giving these agents names and concocting personal back stories for them. He seeks advice from an artificial-intelligence life coach he calls Kira. You'd have a hard time finding a stronger believer in AI's potential.
But even Bell contends that many business leaders today are exaggerating the technology's role in layoffs, a practice that's coming to be known as AI washing.
"It's a wonderful way of looking like a genius when job cuts are something you might have to do for other operational reasons," he says. "It's great smoke cover if you just need to goose your bottom line."
He isn't alone in such a skeptical take.
Leaders at Amazon.com, Block, Atlassian and other companies have linked recent layoffs to AI. But economists and machine-learning specialists say existing technology isn't ready to take humans' jobs at scale.
They argue the most likely reasons for head-count reductions remain the same as ever: slower sales, shifting priorities and previous overhiring.
"AI washing is pervasive right now," says J.P. Gownder, vice president and principal analyst at Forrester Research. "It sounds so much better to say, 'We're laying people off because we're so good at AI and we're creating all these efficiencies.' That sounds so much more rational and innovative."
U.S. employers laid off more than 1.2 million workers in 2025, according to Challenger, Gray & Christmas, a firm that advises companies on staff reductions and helps departing employees find new work. Forrester estimates that fewer than 100,000 of those job losses were primarily attributable to AI productivity gains or cost savings.
Citing AI when downsizing can make a company seem ahead of the curve and boost its stock value. Investors like the idea of a business using technology to run leaner.
Gownder says he speaks regularly with managers who tell him that AI tools need more time to prove their capabilities. Often, there are cybersecurity and regulatory compliance hurdles to clear before a bot can take over a person's tasks.
Forrester projects 6.1% of Americans' jobs could be lost to AI by 2030, as these issues are resolved. That's "bad but not an apocalypse," as Gownder puts it. And a modest displacement tomorrow is different from widespread replacement today.
Shifting narrative
The idea that AI is already gobbling up lots of jobs seems believable because it feels like a suspicion confirmed. Recall that business leaders spent years telling us that AI would assist human workers, not supplant them. Around this time last year, they started sending a more ominous message.
"We will need fewer people doing some of the jobs that are being done today," Amazon Chief Executive Andy Jassy wrote in a memo last spring. Anthropic CEO Dario Amodei predicted that half of all entry-level jobs could disappear in one to five years. Ford Motor CEO Jim Farley went further: "Artificial intelligence is going to replace literally half of all white-collar workers in the U.S."
The truth comes out, we thought. Our robot overlords are here, and resistance is futile.
But if we were naive to believe executives when they initially said AI would merely help us, then perhaps we ought to be skeptical of their new, job-killer narrative, too. Glassdoor chief economist Daniel Zhao is.
"It's actually pretty hard to see evidence of AI impacting the labor market at the macro level," he says. "If you listen to what CEOs say about why they're doing layoffs, sure, some of them are attributing it to AI. How much we should believe them -- that I'm less certain about."
Companies have many incentives to pin staff reductions on AI. It can be a form of product marketing for those that develop and sell AI tools. For managers handing out pink slips, technology offers a ready-made breakup line: "It's not you; it's AI."
More broadly, businesses are reclaiming the upper hand in the employer-employee relationship after a period of worker empowerment. Using an AI boogeyman to shake people up is consistent with that effort.
Cutting on a prayer
None of this is to say that a major reckoning won't come at some point, or that AI hasn't already absorbed some positions.
There can be sound logic behind eliminating jobs before AI is ready to fill the void, adds Gather.dev's Bell. Necessity is the mother of invention, as the saying goes, so forcing a team to play short-handed could compel remaining employees to find productivity hacks faster than they otherwise would have.
Cutting on a prayer can also backfire. Customer-service roles are ostensibly among the most vulnerable to AI. But "organizations are rushing to reduce head count before they're actually seeing the gains from their AI investments," says Kathy Ross, vice president at business-research firm Gartner.
Gartner predicts half of the companies that replace humans with bots in these positions will wind up rehiring people by next year. This is partly because enterprise AI tools and the engineers who manage them can be more expensive than the folks who answer phones. Plus, customers tend to get cranky when it's impossible to speak to a person.
It's clear by now that artificial intelligence isn't just a helpful partner that eliminates busywork and lets us focus on the best parts of our jobs. But it's also not a broad replacement for human workers -- not yet, anyway -- and companies' claims of AI labor breakthroughs deserve scrutiny.
Write to Callum Borchers at callum.borchers@wsj.com
(END) Dow Jones Newswires
March 25, 2026 20:00 ET (00:00 GMT)
Copyright (c) 2026 Dow Jones & Company, Inc.
Comments