AI Jobpocalypse Or Market Correction?

by · Inc42

SUMMARY

  • Companies are increasingly blaming AI for layoffs, but the reality is post-pandemic corrections, cost-cutting and restructuring disguised as automation.
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Ever since OpenAI’s ChatGPT revealed itself to the world in 2022, the internet has been flooded with speculation about AI replacing human jobs. Then came the inevitable. Witnessing AI-native companies do more with less, several others started talking about leaner teams, too. Every productivity gain achieved on the back of coding copilots and autonomous agents nudged humans closer to the exit door until companies came out in the open, blaming restructuring on AI-led automation.

However, underneath this, a more complicated reality is emerging. Companies may simply be using AI as a convenient cover for post-pandemic corrections, restructuring and cost-cutting.

The rationale is simple: If AI coding tools are getting so powerful, why are software engineers still in demand? 

AI is undeniably changing workflows and speeding up certain tasks, but that does not mean human roles have suddenly become redundant. And if AI has truly become capable of replacing humans across organisational structures, why is its impact still far from visible? 

In fact, many enterprises are still struggling with basic adoption and workforce integration, exposing a gap between the promise of AI-driven transformation and its actual impact inside organisations.

Whatever the case is, the internet is abuzz with chatter around the AI job apocalypse. Facts, however, tell a different story — the one we are going to bring to the limelight in this edition of The AI Shift…

The Truth Behind The AI Job Losses

The “AI jobpocalypse” narrative grabbed headlines last week after AI researcher and Coursera cofounder Andrew Ng argued that fears around mass AI-led unemployment are becoming disconnected from reality.

“… Businesses have a strong incentive to talk about layoffs as if they were caused by AI. Talking about how they’re using AI with fewer staff makes them look smart. This is a better message than admitting they overhired during the pandemic when capital was abundant due to low interest rates and a massive government financial stimulus,” he said in a post on LinkedIn. 

Over the last three years, the global tech industry has already been undergoing a painful reset after pandemic-era overhiring. Companies hired aggressively under the assumption that digital adoption curves would continue indefinitely. However, growth slowed, capital became expensive again and organisations suddenly found themselves carrying inflated workforce structures built for a very different market.

AI simply arrived in the middle of this correction cycle.

Pankaj Goel, the CTO of an AI-powered CRM platform LeadSquared, too, reckons that AI has become an ‘easy headline’ for changes that were already underway. In his view, the current moment is less about AI taking jobs and more about companies redistributing work toward higher-order problem-solving and decision-making.