Lose ’em and use it: IT workers replaced by AI as boards pressure CEOs

The wave of tech layoffs is reshaping the IT workforce landscape as companies increasingly replace human workers with AI. Over 314,000 tech jobs have been eliminated since 2024, with corporate leaders under pressure to cut workforce costs by 20% while implementing AI solutions. This trend represents not just temporary cost-cutting but a fundamental restructuring of the digital labor economy, creating winners and losers in the rapidly evolving job market.

The big picture: Corporate boards are pushing CEOs to slash workforce costs by 20%, expecting AI to handle the eliminated positions while preparing for a possible recession.

• Camille Fetter, CEO at Talentfoot Executive Search & Staffing, reports that CEOs at industry dinners are being told, “If you don’t have plans to replace at least 20% of your workforce with these new technologies and efficiencies, then you’re not looking through the right lens.”
• This workforce reduction trend has accelerated in 2024-2025, with over 238,000 IT jobs lost in 2024 and another 76,000 eliminated so far in 2025.

Recent casualties: Major tech companies have announced significant layoffs in recent months despite their public embrace of AI.

• In May 2025, Microsoft cut 3% of its workforce (about 6,000 employees) shortly after CEO Satya Nadella noted that up to 30% of the company’s code is now written by AI.
• Walmart eliminated 1,500 positions, including members of its global tech team, while IBM reportedly laid off 8,000 employees, with many HR workers replaced by AI.

The shifting landscape: Companies are moving away from mass hiring toward more selective scaling and AI integration.

• Patrice Williams-Lindo, CEO of career coaching firm Career Nomad, observes that “companies are trimming legacy roles while quietly hiring for new AI-augmented positions,” creating a deeper reallocation of labor from operational maintenance to innovation.
• Mid-level IT support, QA testing, and certain software engineering jobs are increasingly vulnerable to automation.
• Williams-Lindo notes the irony that “the workers being cut are often the very ones who built” the systems now replacing them.

Skills in demand: The AI transformation is creating new opportunities amid the widespread job losses.

• Workers with “product intuition” and AI skills now command the highest salaries, indicating the value of hybrid skillsets, according to Sam Wright of job seeker site Huntr.co.
• “AI is creating a massive new demand for reskilled professionals who can train, manage, and govern these systems,” says Williams-Lindo, suggesting that those who develop AI fluency will thrive while others risk obsolescence.

Looking ahead: IT layoffs are expected to continue through 2026, with certain roles particularly vulnerable.

• Nic Adams, CEO at 0rcus, predicts that sysadmins, QA testers, back-office IT, and mid-tier management jobs face the highest risk of elimination.
• According to Adams, only “technical specialists tied to critical infrastructure, AI systems, or offensive security have real insulation from these cuts.”