The tech industry is shedding workers at a pace that defies its own financial success, with companies pointing to artificial intelligence as the reason even as skeptics call it a convenient smokescreen. According to TrueUp, a tech job board that operates one of the most-watched layoff trackers, an estimated 363 tech companies have cut jobs this year, affecting close to 150,000 people. That's roughly 974 workers losing their jobs every single day — a 44% acceleration from 2024. The bleeding got worse in October, when nearly 40,000 cuts were announced, the highest single-month total in two years, according to outplacement firm Challenger, Gray & Christmas. For the third consecutive month, AI ranked as the most-cited reason for layoffs across every industry.

That explanation is starting to wear thin with industry observers, who note that many of these same companies went on hiring binges during the pandemic and never meaningfully trimmed the fat. Block, the payments company led by Jack Dorsey, became a flashpoint earlier this year after announcing it was letting go of nearly half its workforce. Dorsey initially insisted the cuts weren't a sign of trouble, posting on X that AI tools are "enabling a new way of working which fundamentally changes what it means to build and run a company." Under pressure from commenters calling out the company's pandemic-era膨胀, Dorsey eventually conceded that Block had in fact over-hired. Venture capitalist Marc Andreessen piled on during a recent conversation with podcaster Harry Stebbings, dismissing AI as the "silver bullet excuse" for layoffs driven by years of mismanagement. "Essentially, every large company is overstaffed. It's at least overstaffed by 25%. I think most large companies are overstaffed by 50%. I think a lot of them are overstaffed by 75%," Andreessen said. "Now they all have the silver bullet excuse: Ah, it's AI."

The tension is amplified by the windfall heading to a small circle of AI insiders at the very moment rank-and-file workers are being pushed out. Earlier this month, AI chipmaker Cerebras Systems closed its first day of trading on the Nasdaq up 68% from its $185 IPO price, giving the company a market capitalization of roughly $67 billion — making it the largest US tech IPO since Snowflake's debut in 2020. The windfall instantly minted co-founders Andrew Feldman and Sean Lie among the latest billionaires minted by the AI boom, a stark counterpoint to the