Tech Companies Accused of Using AI to Justify Layoffs That Correct Past Overexpansion

Meta, Amazon, Microsoft and Google have eliminated roughly 100,000 jobs combined since the post-pandemic retrenchment began, while executives increasingly link leaner staffing to AI-driven productivity. The debate matters because it remains unclear whether automation is already replacing workers at scale or whether companies are using AI to recast conventional cost-cutting and reverse pandemic-era overhiring, raising questions about transparency, labor protections and employers’ burden to substantiate such claims.

The four companies plan to spend more than $700 billion in 2026 on projects largely tied to AI, including data centers and computing equipment. Meta cut nearly 8,000 jobs, about 10% of its workforce, on May 20. Amazon has eliminated at least 30,000 positions since October 2025, while Microsoft announced about 4,800 cuts, or 2.1% of its global workforce, on July 6 as it restructured commercial and Xbox operations.

Bank of Montreal Chief AI and Data Officer Kristin Milchanowski says the root causes of recent technology-sector layoffs are pandemic-era overexpansion and bloated organizations. She called companies’ attempts to blame AI a “lazy” explanation. Milchanowski argues that AI can increase productivity and create new roles over the long term, rather than merely replace workers.

Speaking recently at a digital banking conference, Milchanowski said BMO would use AI to drive business growth while keeping its workforce stable. That approach contrasts with some technology giants that have cited AI to justify layoffs. Reports did not specify the exact date of her remarks or disclose the number of new BMO positions, layoffs or the bank’s AI investment.