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AI Cited in 40% of US Job Cuts in May · Minds, Bodies, and Terawatts

• 0:00
  [Host] This is Minds, Bodies, and Terawatts, where the scoreboard moves faster than the commentary. Challenger, Gray and Christmas reported this morning, June ninth, that AI was cited behind forty percent of all US job cuts in May, ninety-seven thousand positions, a near-doubling from April.
• 0:18
  [Guest] The ramp has been vertical. AI drove ten percent of cuts in February, twenty-five in March, twenty-six in April, pushing past forty-nine thousand AI-attributed cuts through April alone. May will take that well past eighty-five thousand.
• 0:33
  [Host] Which sectors crossed over in May?
• 0:36
  [Guest] Through the first quarter, tech was ground zero. Tom's Hardware reported roughly half of tech-sector layoffs were AI-attributed. But April showed the bleed, with PayPal and Ticketmaster both restructuring around AI.
• 0:49
  [Host] So by May it's moved beyond tech?
• 0:52
  [Guest] Forty percent means displacement has reached customer service, data processing, back-office work. Martin Ford's white-collar recession label fits the Challenger data.
• 1:01
  [Host] How does a white-collar recession square with four point three percent unemployment? The Bureau of Labor Statistics has printed that number three straight months.
• 1:11
  [Guest] Because four point three measures who's still searching, not who's been pushed out. In April alone, two hundred twenty-six thousand Americans stopped looking and fell out of the count. Labor force participation slid to sixty-one point eight percent, lowest since October 2021.
• 1:29
  [Host] And hiring isn't keeping pace?
• 1:31
  [Guest] Seventy-six thousand jobs a month this year against the hundred fifty thousand needed to match population growth. The rate looks calm because the people who can't find work stop being measured.
• 1:44
  [Host] Those companies filing layoff notices, what are they doing with the savings?
• 1:49
  [Guest] Meta fired eight thousand in April and raised 2026 capital spending to a hundred thirty-five billion, eighty-seven percent above last year, almost entirely AI infrastructure. Microsoft offered buyouts to nearly nine thousand.
• 2:03
  [Host] So payroll shrinks and the compute line grows in the same quarter?
• 2:08
  [Guest] Same company, same balance sheet. Snap put rapid AI advancements on the press release by name. This is labor substitution, not a downturn that ends when the economy improves.
• 2:20
  [Host] Does the C-suite see a stopping point?
• 2:23
  [Guest] No. Mercer's 2026 Global Talent Trends report polled eight hundred twenty-five executives, and ninety-nine percent expect AI-driven headcount cuts within two years. Forty-three percent plan to cut junior roles specifically, more than double the seventeen percent who said that in 2025.
• 2:41
  [Host] The Dallas Fed published a paper in February, AI Exposure and Wage Dynamics in the US Labor Market, showing wages in AI-exposed occupations are already falling even as productivity rises. Who captures those gains?
• 2:55
  [Guest] The balance sheet. And the Washington Post's analysis adds a demographic layer: eighty-six percent of workers most vulnerable to AI displacement are women. Administrative support, data entry, payroll processing.
• 3:07
  [Host] Do the new AI-economy jobs absorb any of these workers?
• 3:11
  [Guest] Almost none. Seventy-seven percent of new AI-related positions require a master's degree, and thirteen percent of American adults hold one. Displacement runs downhill while the opportunities stay at the top of the credential ladder.
• 3:26
  [Host] There's a piece on unscarcity dot ai called AI Layoffs 2025 to 2030 that maps this acceleration through Patrick Deglon's Labor Cliff framework, the moment displacement outruns every safety net built for an economy that assumed humans would do the thinking. The book is on Amazon, the audiobook on Spotify. This has been Minds, Bodies, and Terawatts.