Matt Wolfe argues that tech companies blame AI for layoffs when the real cause is over-hiring during the COVID boom. Nvidia CEO Jensen Huang and DeepMind CEO Demis Hassabis have both called out this narrative as lazy, urging executives to stop using AI as a scapegoat for cuts driven by unsustainable cost structures.
Most of the layoffs we've seen, they're using AI as an excuse, but the reality is much different from what I can tell. A lot of these big companies that are laying tons and tons of people off, well, they were bloated companies. There were companies that did a ton of hiring during 2020, 2021, during COVID They got way, way too big. Their expenses got way too high. Now they're realizing they could be much more profitable if they actually cut back. And instead of just saying, we're cutting back to be more profitable because we don't want as much overhead, they're saying, oh, AI is doing a lot more of these jobs. They also believe this is positively going to impact their stock prices because if they say, hey, we're laying off a bunch of people because we got too bloated, well, that doesn't look good for stockholders. But if they say, hey, we're laying a bunch of people off because AI is making this much more efficient, well, stockholders now think they're geniuses. Nvidia CEO Jensen Huang is telling CEOs to stop hiding behind AI as the reason they're letting people go. He went on international television and called the AI layoff excuse lazy and irresponsible. One week after DeepMind CEO Demis Hassabis said the same thing in different words.
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