https://budgetlab.yale.edu/research/evaluating-impact-ai-labor-market-current-state-affairs
Companies are blaming AI for job cuts. Critics say it’s a ‘good excuse’
https://www.cnbc.com/2025/10/19/firms-are-blaming-ai-for-job-cuts-critics-say-its-a-good-excuse.htmlOverall, our metrics indicate that the broader labor market has not experienced a discernible disruption since ChatGPT’s release 33 months ago, undercutting fears that AI automation is currently eroding the demand for cognitive labor across the economy.1
While this finding may contradict the most alarming headlines, it is not surprising given past precedents. Historically, widespread technological disruption in workplaces tends to occur over decades, rather than months or years. Computers didn’t become commonplace in offices until nearly a decade after their release to the public, and it took even longer for them to transform office workflows. Even if new AI technologies will go on to impact the labor market as much, or more, dramatically, it is reasonable to expect that widespread effects will take longer than 33 months to materialize.
Companies are blaming AI for job cuts. Critics say it’s a ‘good excuse’
The headlines are grim, but Fabian Stephany, assistant professor of AI and work at the Oxford Internet Institute, said there might be more to job cuts than meets the eye.
Previously there may have been some stigma attached to using AI, but now companies are “scapegoating” the technology to take the fall for challenging business moves such as layoffs.
“I’m really skeptical whether the layoffs that we see currently are really due to true efficiency gains. It’s rather really a projection into AI in the sense of ‘We can use AI to make good excuses,’” Stephany said in an interview with CNBC.
Companies can essentially position themselves at the frontier of AI technology to appear innovative and competitive, and simultaneously conceal the real reasons for layoffs, according to Stephany.
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Only 1% of the services firm reported AI as the reason for laying off workers in the past six months, down from 10% that had laid off workers using AI in 2024. Meanwhile, 12% of services firms said AI made them hire less workers in 2025.
By contrast, 35% of services firms have used AI to retrain employees and 11% have hired more as a result.
Stephany said there isn’t much evidence from his research that shows large levels of technological unemployment due to AI.
“Economists call this structural unemployment, so the pie of work is not big enough for everybody anymore and so people will lose jobs definitely because of of AI, I don’t think that this is happening on a mass scale,” he said.