Key Points:
- Major firms like Amazon, Nestlé, and UPS announce large-scale layoffs amid weak global sentiment.
- White-collar roles face the highest risk as AI-driven automation accelerates.
- Executives face mounting pressure to prove that massive AI investments are paying off.
Global Layoffs Surge Amid Economic Slowdown
Companies worldwide are tightening their belts, with industry leaders from Amazon to Nestlé and UPS announcing sweeping job cuts. Weakened consumer sentiment, cautious corporate spending, and the accelerating use of artificial intelligence are driving this wave of layoffs.
According to a Reuters tally, American companies have announced over 25,000 job cuts in October alone, excluding UPS’s earlier 48,000 layoffs at the start of 2025. In Europe, the figure exceeds 20,000, with Nestlé responsible for the majority following a 16,000-role reduction last week.
The timing of these layoffs is drawing even greater scrutiny as the U.S. government remains in its second-longest shutdown, leaving official economic data gaps. “Investors are asking themselves what this means since we can’t see the full picture,” said Adam Sarhan, CEO of 50 Park Investments. “Mass layoffs usually point to a slowing economy, not a strengthening one.”
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AI Push and Leadership Restructuring Drive Cuts
Amazon is leading the charge with plans to cut up to 14,000 corporate roles, with some reports suggesting the total could reach 30,000. Target, Procter & Gamble, and Carter’s have also announced significant workforce reductions, mainly targeting white-collar jobs vulnerable to automation.
Target’s cuts will affect 8% of its office staff, while Carter’s plans to eliminate 15% of corporate roles, partly due to import tariffs imposed by U.S. President Donald Trump.
Analysts say the focus on office roles reflects a deeper shift as companies look to justify billions spent on AI technologies. KPMG’s latest executive survey shows a 14% jump in projected AI investment since the first quarter, averaging $130 million per company over the next year.
About 78% of executives report intense pressure from boards and investors to prove AI’s ability to cut costs and increase profits. Despite the high-profile announcements, economists note that most firms remain in a “low-hiring, low-firing” phase, often reducing staff quietly by leaving vacant positions unfilled.
Allison Shrivastava, an economist at Indeed Hiring Lab, describes the current climate as a “hold-your-breath” moment, where firms cautiously navigate economic uncertainty while balancing human jobs against the growing influence of artificial intelligence.