San Francisco: Meta and Microsoft are reducing their workforce by thousands as both companies ramp up massive investments in artificial intelligence, with executives arguing that AI is increasingly meeting productivity demands.
Meta informed employees that it will cut around 10 percent of its workforce, nearly 8,000 jobs, starting May 20, as part of a previously announced restructuring plan aimed at improving efficiency.
The company is also eliminating approximately 6,000 open roles. On the same day, Microsoft announced plans to offer voluntary retirement packages to about 7 percent of its US workforce, totaling around 125,000 employees.
In an internal memo, Meta’s Chief People Officer Janelle Gale noted that the job cuts would help balance the company’s broader investment priorities, without directly referencing AI.
However, CEO Mark Zuckerberg has openly highlighted the company’s aggressive AI expansion, including plans to invest between $115 billion and $135 billion, nearly double the previous year’s capital spending.
Zuckerberg acknowledged the difficult nature of the layoffs but emphasized that AI is already transforming work processes, noting that tasks once requiring large teams can now be handled by a single highly skilled individual.
Meanwhile, Microsoft is offering buyouts to long-serving employees, particularly those whose combined age and tenure reach 70 or more. Reports suggest over 8,000 employees may qualify. The company has also significantly increased its AI spending outlook, now expected to reach between $110 billion and $120 billion.
Mustafa Suleyman, Microsoft’s AI chief, stated earlier this year that AI could replace a majority of white-collar roles within 12 to 18 months. CEO Satya Nadella has also underscored AI’s impact, claiming it already contributes to about 30 percent of the company’s coding work and is driving major productivity gains.
The announcements reflect growing concerns among tech workers about job security as companies increasingly rely on AI. Reports indicate Meta is even using internal employee activity data, such as mouse movements and keystrokes, to train AI systems.
Major line-up behind
Other major tech firms are following a similar path. Block, led by Jack Dorsey, recently cut nearly half its workforce, citing AI-driven efficiencies.
Amazon has laid off at least 30,000 employees in recent months while planning to invest $200 billion in AI infrastructure. Oracle has also announced thousands of job cuts during financial pressures linked to its large-scale data center investments.
As AI adoption accelerates, the tech industry is undergoing a major transformation, with companies betting heavily on automation while reshaping their workforce to align with the new digital landscape.
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