White collar work is undergoing tremendous changes. It’s not just about recruiting or firing employees like before. You often see large-scale layoffs in the news, which has attracted people’s attention. But smaller scale layoffs are also happening, although they may not attract much attention. Nowadays, the company is exploring employee management in new ways. Employees’ expectations for their careers are also rapidly changing.
The rise of artificial intelligence may be the biggest technological force currently changing everything. Large companies will definitely reconsider how many employees they need due to artificial intelligence. And, you see, the recent economic situation has also undergone significant changes. This has to some extent changed who has more power – employers or employees. It seems that the company no longer needs to succumb to the needs of its employees as before.
To understand this, you must go beyond the realm visible to everyone. Let’s take a look at how large companies plan their future employee needs with the strong development of artificial intelligence. Look at the different ways bosses handle the total number of employees in the company. See how regulations like ‘returning to the office’ have changed employees’ lives. See how it affects employees’ daily work experience. And how it affects the entire job market, you know.
1. **AI Driving Workforce Reductions at Giants Like Amazon**: Tech giants have publicly stated that artificial intelligence will definitely change the number of employees. The CEO of Amazon has stated that the number of employees in the company will decrease in the coming years. The reason is actually very simple: artificial intelligence is a huge technological leap for them. You see, it is already changing the way Amazon works every day. He stated that promoting more artificial intelligence should completely change the way work is done. This is written in the boss’s memo, you know.
This is not just an idea; They are heavily investing in artificial intelligence technology. The company plans to invest $100 billion in data centers, which is a huge amount of money. Artificial intelligence requires these data centers to truly function properly, it needs these centers. In addition, billions of dollars in investment have flowed into an artificial intelligence company called Anthropic. The leadership believes that more artificial intelligence agents will help the company develop rapidly. The memo states that agents allow us to initiate tasks from a more optimal location. This technological change means that some existing job positions will require less manpower.
2. **Downsizing Through Attrition**: Sources told The Wall Street Journal that this situation is happening behind the scenes. A large part of Amazon’s layoffs should be natural attrition, and they certainly hope so.
This approach is less destructive than firing a large number of employees at once. Companies can more naturally reduce their employee size over time. It can adapt to constantly changing demands and emerging technologies such as artificial intelligence. In theory, natural attrition is highly beneficial for achieving layoff goals. But this depends on employees continuously leaving. This method works well in large companies with frequent personnel turnover.
However, this method cannot achieve all the required layoff targets, you know. So layoffs may continue for some time.
3. **Layoffs Remain a Reality**: Major companies hope that natural attrition can help them cut many job positions first. But they know that regular layoffs will happen no matter what. The CEO of Amazon stated that natural attrition cannot directly cover all positions that require layoffs. He pointed out that layoffs will come gradually after a period of time. This is exactly the same as what happened recently, you may still remember the situation during this period. Amazon laid off 27000 employees in 2022 and 2023 respectively.
The layoffs have also affected many fields such as AWS, retail, and entertainment. Past cases have shown that Amazon will lay off employees when necessary. They are also preparing for personnel turnover while doing so. The personnel turnover and expected layoffs indicate that their current plans are mixed. Nowadays, major companies are constantly trying to lay off employees in different ways. This undoubtedly indicates that they are strategically utilizing technology.
Perhaps greater economic pressure will lead to an overall reduction in employees. It is currently unclear how many employees Amazon will ultimately lose their jobs. Furthermore, we do not know when the layoffs will truly begin. This indicates that for many professionals, the job market is rapidly changing.
4. **Slowing Hiring as an Early Indicator**: Before the large-scale layoffs became clear, the phenomenon of recruitment slowing down had already occurred multiple times. For example, companies such as Amazon have already encountered this situation. They have slowed down their recruitment pace, you may notice this. This indicates that artificial intelligence is influencing employee needs, not just future plans. Slowing down recruitment helps companies control the total number of employees. Nowadays, they restrict new employees from joining. This is a measure taken before or after personnel turnover and layoffs are imminent.
5. **AI’s Broader Impact on White-Collar Jobs**: The impact of artificial intelligence on employment is far beyond the sum of a single company or field. There are numerous warnings about how it affects certain specific types of work. The CEO of Anthropic has warned that artificial intelligence may replace half of entry-level white-collar jobs. Amazon recently invested billions of dollars in this Anthropic company. This concern is consistent with what people are seeing in the job market today. There are reports that artificial intelligence is continuously shaking the entire job market.
This kind of subversion seems to be concentrated on certain professional levels that you are most likely to notice. According to reports, entry-level white-collar positions are disappearing the fastest. This means that the first job changes brought about by artificial intelligence may have the most severe impact on new professionals entering the field.
6. **Corporate Restructuring Beyond Just AI**: You see, layoffs are not just due to artificial intelligence. Sometimes, companies may undergo larger scale changes for other reasons, ultimately leading to layoffs. Nowadays, they are introducing automation and digital technology to improve efficiency. You may have heard that Procter&Gamble recently announced the layoff of 7000 employees. According to their calculations, this accounts for about 15% of their total non manufacturing jobs.
In addition to layoffs, Procter&Gamble has also sold some of its businesses. The Chief Financial Officer stated that they will thoroughly restructure the entire company layout. He pointed out that this restructuring will advance more automation and digital transformation as planned. In addition, streamlining the management team is also part of the follow-up plan.
7. **Return-to-Office Mandates as a Labor Market Signal**: The recent regulations on resuming work are a signal. They constantly tell us about the current state of the job market. The decrease in remote work and the resumption of orders from large companies indicate that this trend is happening. This indicates that the job market may be weaker than it appears on the surface. This is because the job market in the state has undergone real changes recently.
The severe labor shortage period during the epidemic has basically passed. At that time, the job market was very hot and fast-paced. Do you remember that employers sometimes even allow employees to work completely remotely. Even if they believe that remote work is not the best way to complete work tasks. They are worried about not being able to recruit or retain employees, otherwise the problem will be obvious. John Williams, the President of the New York Federal Reserve, once told me what he observed.
Nowadays, the shortage of manpower has disappeared, and the power of employees to make demands has also weakened. The company is no longer just slowing down recruitment speed; They also do want to save money. Alternatively, they may want to reduce the overall number of employees. Nowadays, the resumption of work regulations are of great significance, not just for those who prefer face-to-face work. This situation occurs when the report shows hidden issues in the work report. For example, the report details a higher unemployment rate.
Statistics on labor force participation rate show a decrease in the number of participants. In addition, the overall situation of employees working remotely has decreased. This timing may suggest that companies may feel strong enough now. Require employees to give up the benefits previously provided during the market tightening period. This indicates that working conditions are gradually improving, silently happening behind the scenes.
