Latest / Minds, Bodies, and Terawatts / AI Is the Number One Reason US Companies Gave for Layoffs Last Month — and 55% of Bosses Who Cut Say It Was a Mistake

Transcript

AI Is the Number One Reason US Companies Gave for Layoffs Last Month — and 55% of Bosses Who Cut Say It Was a Mistake · Minds, Bodies, and Terawatts

• 0:00
  [Host] This is Minds, Bodies, and Terawatts — the show where the layoff number and the layoffs stopped matching. CBS News reported Thursday on new figures from Challenger, Gray and Christmas: American employers announced about thirty-three thousand job cuts in July, the lowest month in two years.
• 0:18
  [Guest] And artificial intelligence was still the number one stated reason, fifth month running. Roughly a third of the total.
• 0:26
  [Host] Layoffs are falling and AI is getting more of the blame. How do both hold at once?
• 0:32
  [Guest] Because Challenger counts what companies say, not what machines do. Andy Challenger said naming AI in a layoff announcement can win investors while pushing current and prospective employees away.
• 0:44
  [Host] So companies are volunteering the blame.
• 0:46
  [Guest] Some are. Others fight it. Visa called its cuts an efficiency push where AI reshapes the work, and Challenger logged that as AI.
• 0:56
  [Host] And where a company pushed back harder?
• 0:58
  [Guest] Montefiore, a Bronx hospital system, cut twelve utilization review nurses after buying automated software, then told Gothamist the union's replacing-humans-with-AI claim was inaccurate and misleading.
• 1:08
  [Host] Challenger has to pick a side on that one.
• 1:12
  [Guest] It doesn't.
• 1:13
  [Host] Meaning?
• 1:13
  [Guest] Those cuts land in a category called technological update, possibly AI. That is the actual precision of the number everyone quotes.
• 1:22
  [Host] Who is in that category?
• 1:24
  [Guest] Marilyn Shuler, a registered nurse reviewing insurance denials, thirty-nine years at Montefiore. Her union quoted her asking for one thing: keep a licensed nurse on the final review, and use AI to support us instead of replacing us.
• 1:39
  [Host] But the jobs are still gone. Are they?
• 1:42
  [Guest] Not all. Orgvue surveyed a thousand senior executives on AI-driven restructuring. Fifty-five percent of the leaders who cut roles now say the decision was wrong.
• 1:52
  [Host] Wrong how? They cut too deep, or the technology didn't work?
• 1:57
  [Guest] Ford is the clean case. Its AI inspection cameras missed defects veteran engineers caught, and Ford brought more than three hundred of them back.
• 2:06
  [Host] What did Ford say?
• 2:08
  [Guest] Charles Poon, its vice president of vehicle hardware engineering, told reporters AI is a fantastic tool, but it's only as good as the information you use to train it.
• 2:19
  [Host] That sounds like a data problem, not a people problem.
• 2:23
  [Guest] It was both. Ford let its most experienced engineers go before their judgment ever got into the system built to replace them.
• 2:32
  [Host] And after the rehire?
• 2:34
  [Guest] Ford topped J.D. Power's initial quality study among mainstream brands this year.
• 2:39
  [Host] So who should be worried right now?
• 2:42
  [Guest] Not that inspector. Anthropic economists Maxim Massenkoff and Peter McCrory, in a research brief published in March on task exposure, found no systematic rise in unemployment among the most exposed workers.
• 2:54
  [Host] Where does it break?
• 2:56
  [Guest] People twenty-two to twenty-five. In high-exposure roles they find work fourteen percent less often, and the authors flag that estimate as barely statistically significant. Above twenty-five, the effect disappears.
• 3:07
  [Host] So it isn't people getting fired. It's the door.
• 3:11
  [Guest] A junior requisition that never opens costs nothing. No severance, no notice. If you are graduating into software or claims processing, that is your market, and it shows up in none of the numbers we just quoted.
• 3:26
  [Host] Patrick Deglon calls that the Labor Cliff in Unscarcity: displacement outrunning the economy's ability to make new roles. Ford got its inspectors back. Nobody gets a press release for the job that was never posted.
• 3:40
  [Guest] And that is what the monthly headline cannot see. For more on how this transition lands on people, and what a floor under them looks like, head to unscarcity dot ai. The book is on Amazon, the audiobook is on Spotify, and this has been Minds, Bodies, and Terawatts.