Hundreds of thousands of tech workers are facing a harsh reality. Their well-paying jobs are no longer safe. Now that artificial intelligence (AI) is here, their futures don’t look as bright as they did a decade ago.

As US tech companies have ramped up investments in AI, they’ve slashed a staggering number of jobs. Microsoft cut 15,000 workers last year. Amazon laid off 30,000 employees in the last six months. Financial-services company Block eliminated more than 4,000 people, or 40% of its workforce, in February. Meta laid off more than 1,000 in the last six months, and, according to a Reuters report, may cut 20% of all employees in the near future. Just this week, the software giant Oracle laid off thousands of workers. Smaller players like Pinterest and Atlassian also made recent cuts, culling about 15% and 10% of their workforces, respectively. Estimates put the total number of tech layoffs in the past year at more than 165,000, according to the tracker Layoffs.fyi.

“At no point in my career have I ever been this pessimistic about the future of careers in tech,” said a tech employee, who has worked at big tech companies for decades and requested anonymity for fear of retribution. “And that’s really sad because I love tech.”

The anxiety extends beyond Silicon Valley. Because tech companies are seen as innovators of the corporate world, as they reduce their headcounts – in anticipation of AI efficiency gains, or to prioritize AI investments – the moves could set a precedent for other businesses to make similar cuts.

But even though AI has helped to accelerate coding, analyze large datasets and aid with research, many AI experts say we’re still a long way from AI being able to replace large swaths of the workforce, if it ever can. So what is really going on?

In interviews over the last month, AI researchers, economists and tech workers said that essentially, we’re all living through an experiment. Over the next few years, tech companies’ experimentation with AI will probably lead to several critical outcomes: more job cuts across industries, unforeseen consequences from overreliance on AI and a fundamentally different model of work.

“The maximum hype you have right now, which is that AI is replacing people, is not true,” said Ethan Mollick, an associate professor at the Wharton School of the University of Pennsylvania who studies AI. “But it’s also not true that AI will never threaten jobs. It’s going to be complicated.”

Reshaping jobs

OpenAI, Anthropic and Google have promised that their generative AI tools, such as ChatGPT, Claude and Gemini, will change the way people do their jobs, automating time-consuming tasks and shifting humans to more complex work. Agentic AI, or bots that complete tasks without human intervention, takes that promise further, potentially automating entire roles or business functions.

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