AI is the convenient scapegoat. Companies frame mass layoffs as a strategic shift toward AI to boost margins and excite investors, but in reality, it signals a deeper business crisis. Not one of these 9,000 jobs will be meaningfully replaced by AI anytime soon.

Also, if it were actually about "low performers", this wouldn't be in the news. They'd just be terminated during/before perf review.

Somehow on places like HN, people aren't worthy of a job, it is the inverse of Peter Principle, keep firing the low performers until they land a job where they manage not to get fired.

That's literally how capitalism determines wages, yes. I too have critiques of capitalism. But I often refrain from enumerating them on every single comment that relates to labor because otherwise we never get to actually discuss labor in its current context.

Fortunately there are other ways to determine wages.

Not every society expects people to achieve maximal performace on quarterly OKR, while management foreman's play rythmic cadence drums and whip slashes.

Ok sure, dude I am with you, I am a socialist. But this doesn't help us navigate the existing system we have to work in until we can finally establish a truly socialist society.

It is a matter who we chose to vote on, the unions we empower, the fight for sensible work protection laws.

Then again, European socialism is already too left for US capitalism mindset.

Eh, it can take a lot of political willpower to actually get rid of a low performer. We had an infamous case where it took two years to finally kick some deadweight to the curb. Wanted multiple years of underperforming performance reviews, I guess. Despite what some may claim about market efficiency, this is a public, wildly profitable company, not government.

Unfortunately, I have never seen a layoff only remove weak people. Plenty of good gets thrown out with the bad every single time. The only signal I take from someone being laid off is that they were unlucky and probably not a total sycophant.

We had a case where it took 10 years to cut 3 FTE deadweights and it only happened because of the 2008 Crash and consequential tightening of money flow.

Think of it more as a "controlled burn wildfire," you want to clear land to let new foliage grow. Same with companies; you clear out some space and see what ideas flourish with the new crop

Or, more likely, leadership is sloppy and lazy. They make mistakes and color outside the lines, and they pay for it. The hope is that they don't hurt themselves too bad.

Luckily for leadership, opportunity cost is completely invisible. They can't travel to alternate realities so they can just pretend they made a good decision and go with that. This is what causes the fun phenomena of "failing upwards" we see in modern American corporate leadership.

Shifting focus is not narrowing focus. They should be able to shift employees accordingly too.

If you have a large sales team for products that are not selling, and you want to invest in building a brand new product, you are not going to be able to move the sales folks into R&D. If you end up building the new product, you may eventually need the sales team, but most businesses in the meantime would reduce the headcount in sales instead of retaining them. I’m not saying that not bad for employees, but shifting focus isn’t always about changing what employees work on.

True. I didn't get to the fact that it was sales due to pay wall.

There's an economic slowdown without relaxing the monetary tightening (because inflation, while relatively mild, is still above target.)

Further cutbacks from the level reached by the prior cutbacks due to monetary tightening when the economy was still in robust growth are to be expected, as are relatively transparent rationalizations that try to put an upbeat spin on them instead of the honest “the cost of money has gone up and the return of spending it on higher staffing levels has gone down.”