Artificial intelligence contributed to approximately 50,000 job losses in the United States during 2025, according to data from the consulting firm Challenger, Gray & Christmas. This figure comes as part of a broader trend of increased layoffs, with a total of 1.17 million jobs eliminated across the country – the highest number since the peak of the COVID-19 pandemic in 2020.
The Rising Impact of AI on Employment
November alone saw 71,000 job cuts, with roughly 9% (6,000 positions) specifically attributed to the implementation of AI technologies. While layoffs occurred across diverse roles and companies, including Amazon and Walmart, the impact has been particularly pronounced for entry-level workers.
Uncertainty and Hiring Freezes
Stephanie Roth, chief economist at Wolfe Research, suggests that companies are increasingly hesitant to hire young workers due to uncertainty surrounding the future direction of AI. Rather than directly replacing entry-level positions with AI, many firms are freezing hiring to maintain flexibility as they navigate this rapidly evolving landscape. This trend may explain a rise in youth unemployment, as businesses postpone commitments to new employees.
The Reality of AI in Finance
Despite some skepticism – as noted in a Fortune report that calls AI-driven job displacement in finance “smoke and mirrors” – the overall effect on the labor market is undeniable. AI is not just taking over jobs but also creating an environment of caution that leads to hiring freezes and reduced opportunities, especially for those entering the workforce.
The year 2025 was exceptionally difficult for U.S. workers, with AI playing a significant role in the downturn. The trend highlights the growing need for workforce adaptation and retraining programs as automation continues to reshape the job market.
