Last week I wrote about where the smart money is going in AI. The watchlist. The companies that stand to make a fortune off the buildout.
Today I want to show you what that buildout is actually doing. Because the story isn’t just about data centers and chip sales. It’s about jobs. Specifically, the ones that are disappearing.
And it’s not just happening in Silicon Valley anymore.
The Numbers Tell the Story
Last Wednesday, Snap announced it was laying off 1,000 people. That’s 16% of its workforce. CEO Evan Spiegel told staff the cuts were happening because “rapid advancements in artificial intelligence” meant fewer people could do the same work.
Two days later, news broke that Meta is planning to cut 8,000 jobs on May 20. That’s 10% of their workforce. More cuts are expected in the second half of 2026.
This is the pattern now. Challenger, Gray and Christmas tracks corporate layoffs every month. Their March report showed 60,620 job cuts announced in the U.S. That’s a 25% jump from February. And for the first time ever, AI topped the list of reasons companies gave for cutting staff.
Since 2023, companies have blamed AI for more than 92,000 job losses. Nearly two-thirds of those happened in 2025 alone. The trend is accelerating.
Who’s Getting Cut
For years, when companies said “layoffs,” they mostly meant factory workers. Retail clerks. Hourly labor. That’s changed.
Amazon recently cut 30,000 corporate roles. About 10% of its white-collar workforce. Block cut half its entire workforce in February. Oracle, Salesforce, Microsoft, Intel all made significant headcount reductions in 2025. The trend rolled right into 2026 without a pause.
Middle management is now the target. Coders. Recruiters. Customer service teams. Marketing departments. Anyone whose job involves producing text, summarizing documents, answering routine questions, or coordinating between departments is on the table.
Tech CEOs aren’t being subtle about this anymore. They’re publicly warning that the knowledge economy is about to go through something similar to what manufacturing went through in the 1980s and 1990s.
What This Means for the Market
Here’s where it gets interesting for investors.
When companies lay off 10% of their workforce and keep revenue steady, profit margins expand. When margins expand, earnings per share go up. When earnings go up, stock prices usually follow.
The same companies driving the AI layoff wave are also the ones most exposed to AI upside. Meta. Amazon. Microsoft. Alphabet. They’re cutting costs on the labor side and capturing productivity gains on the software side.
This is also why the S&P 500 closed above 7,000 for the first time in history last week, despite real geopolitical risk and a Federal Reserve that looks increasingly unlikely to cut rates this year. The market is pricing in a future where corporate America does more with fewer people.
That’s not a moral judgment. Some of you reading this are going to benefit as shareholders. Some of you reading this are going to get hurt as employees or family members of employees. A lot of you are going to experience both.
What to Do About It
If you’re still working, two things matter right now.
First, figure out whether your job is AI-exposed. If most of your day involves producing text, moving information from one place to another, or performing tasks that follow clear rules, you need to be planning. Learn to use the AI tools that could replace you. Build skills that AI can’t easily replicate. Strengthen your network.
Second, rethink your portfolio. If you work in a vulnerable industry, you probably don’t want your retirement savings heavily concentrated in that same industry. Diversification isn’t just about stocks versus bonds. It’s about not having your income and your investments both depending on the same trend going right.
If you’re retired or close to it, the story is simpler. The companies doing the laying off are the ones that stand to benefit most from AI productivity. That doesn’t mean you buy them blindly. But it does mean you should understand what’s driving the market right now. Most of the rally we’re living through is built on the expectation that AI will let companies grow profits faster than wages.
If that expectation holds, markets keep climbing. If it breaks, things get messy fast.
The Bottom Line
I’ve lived through a few of these transitions now. Manufacturing in the 80s. Retail in the 2000s. The media business in the 2010s. Each one created enormous wealth for investors and real pain for workers.
AI is bigger than any of them. And it’s happening faster.
I’m not here to scare you. I’m here to tell you what I’m seeing and what I’d do if I were at my kitchen table looking at my own 401(k) right now. Pay attention to who’s cutting staff and why. Pay attention to who’s saying they’re “increasing efficiency with AI.” That’s the language companies use when they’re about to outperform earnings expectations.
And pay attention to your own situation. The people who do best in transitions like this are the ones who see them coming.
