Biggest AI Layoff Ever

"It depends on how one defines a layoff. Microsoft Corp. ( NASDAQ: MSFT) has done it in waves, a few thousand here and a few thousand there. When one was announced, CEO Satya Nadella said, "the job cuts illustrate the enigma of success in an industry that has no franchise value." That was a vague description of artificial intelligence (AI)."

"The largest AI-related job cut at one time, research shows, is 11,000 people at Accenture PLC ( NYSE: ACN). The company describes itself broadly as an expert in several industries. In reality, it is a management research firm like McKinsey, which has also started to lay off a portion of its staff (it laid off 5,000 people because of a slowdown in its business). Accenture also defines itself as forward-looking. And it competes with the strategic planning arms of former accounting firms Deloitte and PwC."

"Accenture is big. It has 770,000 employees worldwide and says it has 9,000 clients in 190 countries. Wall Street does not like it, as its stock is down 33% this year. The broader market is up 14% over the same period. In its most recently reported quarter, per-share earnings fell from $2.89 the year before to $2.27. The company's growth years appear to be behind it. The share price is up only 3% in the past five years, while the market is 91% higher."

Large technology and consulting firms are reducing headcount as AI automates repetitive and research-intensive tasks. Microsoft executed layoffs in waves, and Accenture eliminated 11,000 jobs tied to AI adoption. Accenture employs 770,000 people, serves 9,000 clients across 190 countries, and faces declining stock performance and earnings, with per-share earnings down from $2.89 to $2.27 and shares up only 3% over five years versus a 91% market gain. Employers are cutting roles that cannot be retrained to use AI, including HR positions and junior research or investment banking roles that perform repetitive pattern-finding work.

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