As Microsoft-owned LinkedIn has reportedly announced layoffs in multiple teams, the company's co-founder, Reid Hoffman, has urged caution about the growing list of tech layoffs blamed on artificial intelligence (AI). He argued that the term "AI" is increasingly being used to explain job cuts that are actually driven by more traditional reasons, such as companies hiring too many employees during the pandemic years. In a post on X, Hoffman wrote: "Just a reminder that we're likely to see more layoffs announced 'because' of AI, it makes companies seem strong and moving forward. It's important not to ignore other factors, including hiring trends 2020-2023, that might be present."
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The post has resurfaced at a time when LinkedIn has announced 5 per cent layoffs across different teams, including engineering and marketing, according to the company's internal memo. LinkedIn has a global workforce of 17,500 employees.
The pandemic hiring boom
Reid Hoffman’s post is in reference to the 2020–2023 pandemic period during which major tech companies hired employees at a very rapid pace, often faster than their actual business needs. According to an analysis of company filings by The Washington Post, Amazon, Google and Meta today still have nearly the same number of employees they had at their peak in 2022, despite carrying out several rounds of layoffs since then.
Venture capitalist and Meta board member Marc Andreessen also recently shared a similar view on a podcast. He said layoffs at large companies are usually caused by overhiring or changing economic conditions, but many firms now use AI as a convenient explanation. “Now they all have the perfect excuse: ‘It’s AI,’” Andreessen said.
OpenAI CEO Sam Altman has gone further, coining the term "AI washing" for the trend. Speaking at a conference in March, Altman said: "Almost every company that does layoffs is blaming AI, whether or not it really is about AI."
How many employees is LinkedIn laying off?
LinkedIn CEO Daniel Shapero did not reveal the exact number of layoffs in the internal memo. Instead, he said affected employees would receive an email about an hour after the memo was sent. According to a Reuters report, LinkedIn could cut nearly 5 per cent of its workforce, which may affect around 875 employees.
Shapero added that the layoffs would mainly impact teams in the Europe, Middle East and Africa (EMEA) region as well as Asia-Pacific (APAC). He said LinkedIn is looking to “reinvent” the way it operates by creating more agile teams focused on key priorities. The company also plans to redirect investments toward areas such as infrastructure to support its long-term goals and vision.
Which areas will be affected?
In the memo, LinkedIn CEO Daniel Shapero stated that the reductions would affect a range of functions, including the Global Business Organisation, marketing, engineering and product, reports Business Insider. The memo also said LinkedIn would scale back spending on marketing campaigns, vendor spend, customer events and underutilised office space as it seeks to operate more profitably.
Read full memo
"Team,
Economic opportunity is one of the societal issues of our time, and Linkedin has been and will continue to be the platform that professionals and companies turn to as they navigate the changing world of work. For us to meet this moment, we must ready ourselves to deliver a step change in impact across our products, businesses, and platforms, while continuing to operate more profitably. We need to reinvent how we work, with agile teams focused on our highest priorities, and by shifting investments toward areas such as infrastructure to fulfill our mission and vision over the long term. This requires hard prioritization and tradeoffs.
Today I'm sharing the difficult decision that I, along with our leadership team, have made to reduce roles across GBO, Marketing, Engineering and Product. If you are impacted, or proposed to be impacted in EMEA & APAC, by these changes, you will receive a calendar invite to a notification meeting within the next hour. For impacted teams, you'll learn more about your org-specific information from your leaders shortly, and updates will be added to go/CompanyExchange throughout today.
In addition to role reductions, we are scaling back investments in some areas including marketing campaigns, vendor spend, customer events, and underutilized office space, so we can focus teams on priorities that have the broadest impact with the highest ROl. You will receive details about these changes from respective functional leaders.
I want to acknowledge and thank those who will be leaving Linkedin. You have helped build LinkedIn's culture and platform into what it is today, and I hope you are proud of the lasting impact your work will continue to have on our members, customers, and colleagues.
For those staying, first and foremost, I would like to invite you to support our impacted colleagues. We will move forward together with focus and clear priorities to reach our potential as the platform that the world's professionals and companies increasingly turn to.
Thank you, again, to our teammates who are departing, and to everyone across LinkedIn who continues to show up and support each other.
