IBM and Klarna admit AI is replacing jobs amid ongoing layoffs.
IBM CEO revealed 200 HR roles cut to AI chatbots while growing headcount elsewhere. Klarna CEO said their workforce shrank from 5,000 to about 3,000 as AI transformed operations.
Experts say many companies hide AI job cuts behind terms like "restructuring" and "optimization." Harvard’s Christine Inge calls it "AI-driven workforce reshaping, without the public acknowledgment." 
Jason Leverant, COO at AtWork Group, adds companies cloak AI layoffs with euphemisms to avoid backlash. Parsons Corp’s Candice Scarborough notes layoffs don’t follow financial trouble but AI rollouts. She says vague terms mask job displacement by software.
Many layoffs hit content, operations, customer service, and HR—areas where generative AI excels. Inge calls corporate silence “strategic” to dodge employee and regulatory blowback.
Christine Inge stated:
"What we’re likely seeing is AI-driven workforce reshaping, without the public acknowledgment."
"This silence is strategic. Being explicit about AI displacement invites blowback from employees, the public, and even regulators."
Taylor Goucher of Connext Global warns while AI may automate 70%-90% of tasks, human oversight remains crucial. Firms often fill gaps offshore or via third parties when AI falls short.
Mike Sinoway of LucidWorks says layoffs aren’t fully AI-driven yet but notes execs panic over slow AI payoff.
Candice Scarborough added:
"They align suspiciously well with the rollout of large AI systems. That suggests that jobs are being eliminated after AI tools are introduced, not before."
"Restructuring sounds proactive; business optimization sounds strategic; and a focus on cost structures feels impartial. But the result is often the same: displacement by software."
Freelancers were first hit, openly told AI replaced them in roles like copywriting and video editing. Full-time staff face indirect messaging due to backlash after Duolingo’s CEO walked back AI-driven contractor cuts.
Christine Inge noted:
"Often, they are being told they are being replaced with an AI tool."
"After the huge backlash that Duolingo faced, companies are afraid to say that is what they are doing."
U.S. unemployment dropped to 4.1% in June 2025. But a World Economic Forum report says 41% of employers plan AI-driven workforce cuts in the next five years. Anthropic CEO Dario Amodei predicted generative AI could eliminate half of entry-level office jobs.
Christine Inge concluded:
"By then it won’t matter. Job losses will be extremely large, the only thing we can do as individuals is adapt."
Expect more AI layoffs, but firms will keep quiet until it’s impossible to hide the impact.
