The Dive
My first layoff, two years into my career: I broke out in hives the day I had to deliver it. All over my legs. My body knew something my mind hadn't caught up to yet.
We called ourselves a family of companies. Then the economy shifted, and we did layoffs anyway. One man looked at me and asked: "If we are family, how are we doing layoffs?" I didn't have an answer. Because no one above me had actually wrestled with why the business needed this, or what we were trying to protect. We just reached for the easiest lever (reduce headcount) and called it necessary.
I think about that man's question every time I read a layoff announcement, no matter which way it points the finger.
This year's version of that story started earlier than I realized. In February, Sam Altman, OpenAI's own CEO, said the quiet part out loud: some companies are "AI washing" layoffs they would have made anyway. Weeks later, Jack Dorsey cut Block's headcount by nearly 40%, promising "a new way of working," while also saying "we're not making this decision because we're in trouble. Our business is strong." Wix, Cisco, Snap, and Atlassian followed with similar AI-driven framing through the spring, and by May, MIT Sloan's Paul Osterman was calling the whole pattern "a perfect excuse to justify big layoffs."
Then something shifted. Over the summer, some of the biggest names in the industry started saying the opposite. Microsoft cut 4,800 jobs on July 6, and its Chief People Officer, Amy Coleman, said plainly that the eliminated roles were "not being replaced by AI," even while noting "AI is changing how work gets done." Monday.com cut 600 people (20% of its staff) on July 25, and co-founder Eran Zinman said the move "was not made to reduce costs or replace people with AI." Etsy cut 220 people (12% of its workforce) on August 5, and CEO Kruti Patel Goyal said the cuts "weren't driven by AI," while acknowledging technology is "changing the skills and capabilities" the company needs.
Not everyone is being coy about it, in either direction. Salesforce's Marc Benioff has bragged that AI let him cut support headcount "from 9,000 to about 5,000 because I need less heads." Klarna's CEO said much the same thing back in 2024: "we can do much more with less." Those leaders own the AI story loudly. The ones above are working just as hard to disown it.
Both instincts landed at almost the exact same time real numbers came out. On August 26, a Layoffs.fyi report found that 54% of 2026's layoff events cited AI or automation as a factor, up from under 8% in 2025. Separately, Axios reported that nearly 113,000 of this year's announced job cuts, 24% of the total, have AI listed as the single stated reason, and that AI has topped the monthly list of cited causes for five straight months. Two different trackers, two different numbers, same direction: AI has never been named this often, right as several of the companies doing the naming started refusing to use the word.
Here's what catches my attention about the timing. The "it wasn't AI" statements started landing right after "AI washing" became a phrase serious people were using out loud, first Altman, then Osterman, then enough press coverage to make leaders visibly careful. Which raises an uncomfortable question: is "it wasn't AI" actually more honest, or is it just this quarter's more sophisticated version of the same dodge?
Because notice what's still missing from most of those statements: not one of them names what it actually was, beyond a phrase about as vague as the one they're avoiding. "Changing the skills and capabilities we need." "A new way of working." That's not more specific than blaming AI. It's just a more careful non-answer.
Here's what actually bothers me about either version: neither one is a strategy. Both are ways to avoid the exact question that man asked me twenty years ago: what are we actually trying to protect, and did we look at every other option before we reached for people? "AI made us do it" and "it definitely wasn't AI" answer neither one. They both just make the decision sound like something that happened to the company instead of something the company chose. That's what makes it lazy leadership. Not that the layoff happened, but that nobody had to own the reasoning behind it, whichever direction they pointed.
Two takes worth sitting with if you're the one making this call soon:
Take 1: sometimes it's real, and sometimes "not AI" is real too, but neither claim means anything without the receipts. Jim Collins has said some version of this for years: the economy isn't a strategy, and neither is new technology (or the absence of it). Good strategy is. Monday.com's version of this is at least closer to a real answer: the company points back to an AI-first strategy it set roughly a year before this round of cuts, not something invented for the press release. That's what a leader doing real scenario planning sounds like, a decision that traces back to a direction the company was already heading in, whether the headline says "AI" or "not AI." A leader operating just for tomorrow reaches for whichever word sounds best after the fact.
Take 2: most of it, in both directions, is avoidance, and the avoidance is getting more sophisticated, not less. We've been living inside this AI bubble long enough that "blame AI" stopped working as a clean excuse the moment Altman himself, then Osterman, then a wave of coverage started calling it out. So the newer move for some leaders is to deny it instead, which sounds more responsible without actually costing them any specificity. Other leaders have gone the opposite way and started bragging about the headcount AI let them cut. Both are message management. Neither is the honest sentence: if the real reason is cost, say cost. If it's overhiring, say that. People don't need the decision to be flattering, in either direction. They need it to be true. And how you communicate the hard call, more than the call itself, is where your culture actually shows up.
My hypothesis: you can tell which one you're looking at by whether the story points forward or points away, regardless of which word, AI or not AI, it's built around. A leader with a real strategy can name the specific thing that changed, which task, which decision, which output, and connect it to where the company is actually headed. A leader avoiding the real reason can only gesture at a concept, whichever concept is least embarrassing this quarter, because naming the specific thing would mean admitting it was a decision, not a force of nature that happened to them.
This is also part of why I think every leadership role now needs communications as a core skill, not something you hand off to comms the week of the announcement. Getting a message like this right (honest, tied to real strategy, tied to your actual values) takes time, thought, and work, whether you're the company blaming AI, bragging about it, or insisting it had nothing to do with it. It's a muscle you build well before you need it, not one you can improvise under pressure.
The Save
If you've got a headcount decision coming in the next few quarters (AI-driven, market-driven, or otherwise), a few questions worth answering before you write the announcement, not after:
Can I name the specific task, workflow, or output that changed, not "AI" and not "definitely not AI," the actual thing that's different now? If not, this isn't a real answer either way. It's a cost decision wearing whichever costume is fashionable this quarter.
Have I asked what we're protecting by making this cut, the same question I got asked twenty years ago and didn't have an answer for? If you can't answer it before the meeting, you won't be able to answer it during the layoff either.
Am I willing to say the honest sentence to the people who stay, "this was about cost, and here's why," instead of the comfortable one? Employees can tell the difference, and the ones with the most options are the ones most likely to leave first when they sense the comfortable version is cover.
Did the communications plan start before the decision was final, or after? If the messaging only comes together the week of the announcement, that's usually a sign the strategy behind the decision wasn't fully worked out either. The two get built together, not in sequence.
One thing to try this week: if you have a layoff coming, or already announced one, write the actual, specific reason in one sentence. No euphemism, no "AI," no "it definitely wasn't AI," no "the market." If you can't write that sentence honestly, that's the sentence to go figure out before someone else asks it for you.
Have you sat in the room where this decision got made, or been on the receiving end of the announcement yourself? What was the real reason, versus the one that got said out loud? Reply and tell me. I read every one.
Talk soon, Anita
This is Issue 07 of Live Wire, a weekly jolt of candid thinking for CEOs, founders, and people leaders who know culture isn't a side project, it's how a business performs. If this landed, forward it to a leader about to announce a headcount decision, before they write the press release version.
Sources:
"Sam Altman says the quiet part out loud, confirming some companies are 'AI washing' by blaming unrelated layoffs on the technology," Fortune, Feb 19, 2026
"CEOs blame AI for layoffs, but an MIT professor says it fits a long-running pattern to find a cover story," Fortune, May 31, 2026
"Block CEO Jack Dorsey lays off nearly half of his staff...," Fortune, Feb 27, 2026
"CEOs shift messaging around AI and layoffs," Axios, Aug 20, 2026
"As Microsoft Lays Off Almost 5,000 Employees, Its HR Chief Makes a Statement About AI," Inc. and "Microsoft insists 4,800 layoffs aren't because of AI," Windows Central
"Monday.com is the latest tech company to blame AI for layoffs," TechCrunch, July 25, 2026
"More Than Half of Layoff Events Tracked in 2026 Cited AI or Automation, Report Says," IBTimes UK, citing Layoffs.fyi, Aug 26, 2026