10,000 U.S. Job Losses In July Tied To Rise Of AI Tools

Artificial intelligence is now playing a major role in job cuts across the U.S., according to new analysis.

More than 10,000 jobs were lost in July alone due to the growing use of generative AI, according to a new report by outplacement firm Challenger, Gray & Christmas, which was first reported by CBS news.

The firm lists AI as one of the primary factors responsible for the 806,000 private-sector job losses announced this year which represents the highest number since 2020.

“The industry is being reshaped by the advancement of artificial intelligence and ongoing uncertainty surrounding work visas, which have contributed to workforce reductions,” the firm said, as reported by CBS News.

Amazon CEO Andy Jassy echoed this shift in a memo to staff, announcing plans to reduce corporate roles as the company leans heavily into AI.

“We will need fewer people doing some of the jobs that are being done today, and more people do other types of jobs,” Jassy said, noting that over 1,000 AI-powered tools are in use or development at Amazon.

The tech industry faces the most impact with more than 89,000 job reductions throughout this year which represents a 36% increase from 2024. More than 27,000 of those have been directly tied to AI since 2023.

CBS News also notes that job listings for entry-level corporate roles, often filled by recent graduates, have dropped 15% over the past year. In the same period, mentions of “AI” in job postings have surged by 400%.

LinkedIn’s chief economic opportunity officer, Aneesh Raman, has warned that AI is destroying traditional entry-level roles that help young workers launch their careers. Raman noted that tasks once assigned to junior employees, like debugging code or supporting legal teams, are now performed by AI, especially in tech and finance.

He added that this trend could worsen inequality, locking out those without elite networks, and suggested that schools begin teaching AI literacy to prepare the next generation of workers.

Andrew Challenger, senior vice president of the firm, also pointed to other pressures fueling the job crisis. “We are seeing the federal budget cuts implemented by DOGE impact non-profits and health care in addition to the government,” as reported by CBS News.

Retailers are also laying off workers at record rates. Over 80,000 jobs were cut in that sector through July, a 250% increase from last year. The firm blames rising tariffs, inflation, and falling consumer demand.

The Independent reports that Josh Bershin, CEO of workforce consultancy The Josh Bersin Company, said, “There’s basically a blank check to go out and buy these AI tools […] then they go out and say, as far as head count: No more hiring.”