Corporations across continents are tightening their belts, with major employers from Amazon to Nestlé and UPS announcing sweeping job cuts as global sentiment falters and artificial intelligence begins to reshape workforces.
The move signals growing unease among companies balancing slower demand with the need to justify their hefty AI investments.
According to a Reuters compilation, American companies have disclosed more than 25,000 job cuts in October alone, not including UPS’s earlier announcement of 48,000 layoffs since the start of 2025. Across Europe, the figure exceeds 20,000, led by Nestlé’s decision to eliminate 16,000 positions last week.
The timing has amplified market anxiety, with the US government still mired in its second-longest shutdown, delaying comprehensive employment data. For now, investors are piecing together the picture through corporate announcements. “Investors are asking themselves, what does this mean? And specifically, what’s the overall picture since we can’t see it?” said Adam Sarhan, chief executive of 50 Park Investments in New York.
“Cuts like those at Amazon tell me the economy is slowing down, not getting stronger. You don’t have mass layoffs when the economy is strong.”
AI Pressure and CEO Shakeups Drive Decisions
Amazon confirmed plans to trim up to 14,000 corporate roles, joining the likes of Target, Procter & Gamble, and Carter’s in restructuring their white-collar workforces.
Reports suggest as many as 30,000 Amazon positions could ultimately be affected. The drivers vary, while companies such as Target and Nestlé are acting under new leadership eager for change, others like Carter’s, are battling the impact of steep tariffs introduced by US President Donald Trump.
What distinguishes this round of layoffs, analysts note, is the focus on office jobs that can be automated rather than traditional factory or retail roles. Many see Amazon’s decision as an early indication of a deeper shift towards AI-driven efficiency. With billions poured into machine learning and data analytics, corporate boards are demanding clear returns on their investments.
A recent KPMG survey of US executives found projected AI spending up 14 per cent since the first quarter, averaging $130 million per company over the next year. Nearly four in five respondents said they face strong pressure from shareholders to prove AI is cutting costs and lifting profits.
Bank of America economists noted that entry-level and routine white-collar roles are most at risk from automation, even as overall employment in information, finance, and professional services continues to grow alongside AI adoption.
Still, some experts caution against drawing conclusions too quickly. “I’m reticent to say it’s AI just yet,” said Allison Shrivastava, economist with Indeed Hiring Lab. “It has the potential to impact the labour market, but I don’t think we’re seeing that strong an impact right now.”
Labour Market in a “Hold-Your-Breath” Phase
With the ongoing US government shutdown clouding official data, economists are relying on limited indicators to gauge momentum. State-level jobless claims have yet to show a clear uptick, though hiring has also slowed to a crawl. Payroll firm ADP estimated only 14,250 new jobs were created in the four weeks ending October 11.
Despite the headlines, the broader labour market appears to be drifting through what economists describe as a “low-hiring, low-firing” lull, and companies are trimming numbers gradually by leaving roles unfilled rather than issuing mass pink slips. However, should the wave of layoffs gather pace, analysts warn it could erode consumer confidence and deepen existing economic strains from tariffs and stubborn inflation.
Federal Reserve officials are keeping a close eye on these developments, fearing that prolonged caution could tip the economy into sharper job losses. “I describe this as a ‘hold-your-breath’ environment,” Shrivastava said. ‘Low-hire, low-fire almost makes it feel like we’re in this new equilibrium, where really companies are just holding their breath, trying to figure out what’s going on.’
