This Report Says AI Stole 17,000 Jobs This Year. The DOGE Effect Is Much Worse

AI evangelists continue to insist that AI is improving workers’ efficiency and thus business productivity, freeing up staff from mundane duties to do more meaningful work. Not as many boosters are cheering the fact that it’s just as easy for companies that have gone all in on the new technology to cut labor costs by replacing people’s jobs. According to a new report thousands of jobs have already gone from the job market this year as AI has assumed those duties instead, and fully 7,000 of the losses happened in September alone. All of this may feed into your thinking about rolling out AI at your own company. The data, from Chicago-based executive outplacement firm Challenger, Gray & Christmas, attributes 17,375 job losses to adoption of AI tech since the start of 2025. Most of these cuts were made public in the second half of the year, industry news site HRDive reports. The numbers are dramatic, especially since a similar report from Challenger in July said that among some 20,000 jobs lost to “automation” in the first half of the year, only 75 were directly connected to AI. Andy Challenger, senior vice president at the firm, told CFODive at the time that the suspicion was that many more jobs were actually lost to AI. “We do see companies using the term ‘technological update’ more often than we have over the past decade, so our suspicion is that some of the AI job cuts that are likely happening are falling into that category,” Challenger said then, also noting that some firms were being careful because they “don’t want press on it.” In the new report, Challenger noted that it’s mainly tech firms that are “undergoing incredible disruption,” because of AI. Challenger also backed up many earlier reports by noting that the buzzy, controversial tech is “not only costing jobs, but also making it difficult to land positions, particularly for entry-level engineers.” HRDive notes that it’s losses at Salesforce that may be linked to those massive AI-related job cuts in recent months, with Salesforce CEO Marc Benioff noting in August that customer service staff numbers were slashed by about 4,000 after AI agents took on some customer handling duties. The interesting wrinkle here is that Salesforce is one of the big tech names that is pivoting aggressively and openly to adopting AI tech, and is even selling it to its customers with the promise that agent-based AIs can save them money. Benioff in early 2025 also said “my message to CEOs right now is that we are the last generation to manage only humans.” In his vision for future company leadership, managers will be steering both AIs and humans through their day to day operations. While 17,000 jobs lost to AI sounds like a lot, it’s dwarfed by other causes, the Challenger report shows. DOGE-related actions is the “leading reason for job cut announcements in 2025,” the report notes, with 293,753 planned layoffs connected to DOGE activities, including reductions to federal workforce numbers and the cutting of contractor deals. Nearly 21,000 more jobs have been lost as part of what Challenger’s report says is “DOGE Downstream Impact,” where funding cuts have hit nonprofits that depend on federal grants. Traditional market and general economic concerns drove another 208,227 cuts in 2025, the report also notes. This means DOGE and the typical workings of the economy are responsible for around 30 times as many job losses than AI. But it would be unreasonable to assume AI’s body count won’t rise, considering Big Tech’s push to get AI into the workplace, while developing increasingly capable AI tools that can handle human jobs. And while Challenger notes that tech-centric firms are bearing the brunt of AI-related job cuts right now, it would be sensible to guess that other industries will soon follow. What’s the takeaway for your company? Primarily that it may be a good idea to reassure your staff that if you’re rolling out AI tools to streamline operations, you’re not actually planning on downsizing your workforce. ”AI won’t be stealing anyone’s job here” is a strong message that will build your team’s trust, assuming that this is actually the case. Another side effect may be a glut of workers in the job marketplace. Since many job seekers are using AI tools to boost their hunt for new employment, you may actually see many more applicants than before for open positions at your company, and your HR team may be quickly overburdened. BY KIT EATON @KITEATON