Major US employers are cutting tens of thousands of white-collar positions, signalling a shift where office work becomes scarcer, partly due to the increasing adoption of artificial intelligence. Companies including Amazon, UPS, and Target have announced significant reductions in corporate and management roles, pushing experienced workers into a challenging job market, reports The Wall Street Journal.
Amazon revealed this week plans to cut 14,000 corporate jobs, aiming to eventually reduce its white-collar staff by up to 10 per cent. This follows UPS confirming it had cut about 14,000 management positions over 22 months, and Target eliminating 1,800 corporate roles. Other firms, such as Rivian, Molson Coors, Booz Allen Hamilton, and General Motors, have also recently implemented or announced layoffs.
This trend marks a “leaner new normal” where large companies retrench, leaving fewer well-paying office jobs. Nearly two million people in the US have been unemployed for 27 weeks or more, recent federal data shows.
AI is a key factor
The embrace of AI is a key factor, with executives anticipating that AI can perform tasks previously done by highly compensated employees. Investor pressure for increased efficiency with fewer staff, alongside political uncertainty and higher costs, also contributes to slower hiring. Mike Hoffman, CEO of consulting firm SBI, noted his company cut its software development team by 80 per cent in six months while boosting productivity using AI agents for coding. “Our AI writes its own Python,” he said.
The impact extends beyond layoffs. Remaining managers often oversee more staff with less time for individual interaction, while employees face heavier workloads. Job seeker confidence is waning, with only around 20 per cent of Americans surveyed by WSJ-NORC this year expressing high confidence in finding a good job, down from previous years.
Kelly Williamson described being abruptly laid off from Amazon’s Whole Foods Market via an early morning email, with her access deactivated immediately. Chris Reed, 33, formerly in tech sales, spent ten months applying for over 1,000 jobs after his layoff, eventually taking a position selling cars with a long commute that strains his family life.
While office roles shrink, demand grows for front-line, blue-collar, and specialised workers in trades, healthcare, hospitality, and construction. Recruiters observe a surge in older workers struggling to keep pace with technology, while companies become highly selective, seeking candidates with exact qualifications. This selectivity also squeezes entry-level positions, with recent graduates facing tougher prospects.
The trend is further exemplified by online-learning company Chegg, which announced on Monday it would cut 388 jobs, roughly 45 per cent of its workforce, as it pivots to an AI model for answering student questions.
