The company is also shutting down about 6,000 open positions.

In an internal memo, Chief People Officer Janelle Gale explained that the layoffs would help the company "offset the other investments we're making." While she did not directly mention AI, the company has been aggressively increasing its AI spending.

CEO Mark Zuckerberg had earlier highlighted a major AI acceleration, revealing plans to invest between $115 billion and $135 billion in AI almost double the previous year's capital expenditure. "This is not an easy tradeoff," Gale wrote, adding that affected employees would receive strong severance packages. Zuckerberg, however, has been more direct about AI's role in reducing hiring needs. "We're starting to see projects that used to require big teams now be accomplished by a single very talented person," he said.

Microsoft Offers Buyouts Instead of Direct Layoffs

Unlike Meta, Microsoft is not carrying out immediate large-scale layoffs but is reducing staff through voluntary retirement offers. The company has buyouts option to around 7% of its US workforce, which totals about 125,000 employees. These offers are mainly targeted at long-serving staff, particularly those whose combined age and years of service equal 70 or more. Reports suggest that more than 8,000 employees could be eligible for this programme.

Massive AI Spending Driving Workforce Changes

Both companies are investing heavily in AI infrastructure. Microsoft had earlier projected spending around $100 billion on AI, with analysts now estimating the figure could reach $110-$120 billion. Mustafa Suleyman said in February that AI could replace most white-collar jobs within the next 12 to 18 months.

CEO Satya Nadella has also highlighted how AI is transforming operations. He revealed that AI already handles nearly 30% of Microsoft's coding work. "We are only at the beginning phases of AI diffusion, and already Microsoft has built an AI business that is larger than some of our biggest franchises," he said.

AI Reducing Need for Human Workforce

Zuckerberg echoed similar views, suggesting that AI could soon handle a large share of development work. "Our bet is sort of that in the next year probably … maybe half the development is going to be done by AI, as opposed to people, and then that will just kind of increase from there." These developments have raised concerns among tech employees about job security as AI continues to evolve.

Industry-Investing Heavily in AI in High Trend of Job Cuts

Meta and Microsoft are not alone. Several major tech companies are cutting jobs while investing heavily in AI:

• Jack Dorsey reduced nearly half of his company's workforce, citing AI efficiency gains.
• Amazon has laid off at least 30,000 employees in the past six months while planning to invest around $200 billion.
• Oracle has also announced thousands of job cuts amid financial pressure from large data centre investments.

In short, the shift toward artificial intelligence is rapidly changing the tech industry. As companies like Meta Platforms and Microsoft invest billions into AI, they are also reshaping their workforce signalling a future where automation plays a much bigger role in daily operations.