New Intelligence Source Report
Edited by: Aeneas Ding Hui
【New Intelligence Source Guide】Now, AI has completely triggered a global wave of unemployment, and Duolingo's layoffs are just the first domino to fall. Foreign media statistics show that five major companies worldwide have already laid off tens of thousands of people because of AI. Furthermore, statistics indicate that the unemployment rate among recent US college graduates is unusually high, reaching 5.8%!
No kidding, the global unemployment wave brought by AI is really here!
Before, this call was only predicted by a few individuals, but now, mainstream media has fully recognized this fact: Artificial intelligence will completely change the global labor market.
Recently, media such as Forbes and TechCrunch have issued warnings.
Now, due to the influence of AI, a large number of people are already unemployed.
For example, Obama and his team are now discussing the serious consequences of this matter.
When human jobs are invaded by AI, where should we go?
"Initially, no one cared about this disaster. It was just a wildfire, a drought, the extinction of a species, the disappearance of a city, until this disaster became relevant to everyone."
Duolingo, and there will be more
Everyone knows about Duolingo.
In fact, this is not even new.
A TechCrunch reporter interviewed a former Duolingo employee who said that the company had already laid off 10% of its employees at the end of 2023, and there was another round of layoffs in October 2024.
In these two major layoffs, translators came first, followed by writers, who were all replaced by AI.
At the end of 2023, the reason for Duolingo's layoffs was that a large amount of content production and translation had been simplified using models such as GPT-4.
Below is a layoff email sent by Duolingo.
A laid-off employee revealed on Reddit that the company's reason was that AI can now replace creators, translators, and almost all similar positions.
It is said that each team only retained a handful of people to continue working as "content editors". Their job is to check the garbage content generated by AI and then click publish.
In addition, Duolingo also used GPT-4 to support the premium subscription version, Duolingo Max, using an AI chatbot to help users practice conversations. They also have a proprietary AI model, Birdbrain, to provide personalized courses for users.
However, neither the laid-off employees nor Duolingo were satisfied with this.
For the laid-off employees, being replaced by AI was a heavy blow. Job instability also caused mental distress, and they often found it difficult to find stable jobs due to incomplete resumes.
Moreover, most of Duolingo's employees are contract workers. With this mechanism, the company can save a lot of costs and does not need to provide benefits such as insurance, paid vacation, and sick leave.
At the same time, Duolingo users are also concerned that using AI for translation will strip away the value of experts who have a deeper understanding of language, idioms, and cultural nuances.
As early as the 2023 "Future of Jobs Report", the World Economic Forum predicted that AI would change 23% of jobs in the next five years.
Now, two years have passed, and this prediction is becoming increasingly evident.
This crisis, seemingly simple, is essentially just "a series of management decisions made by executives aimed at cutting labor costs and strengthening control within the company."
However, the consequences are the loss of talent in creative industries, declining income for freelance artists, writers, and illustrators, and the tendency of major companies to hire fewer human employees.
According to foreign media reporter Brian Merchant, the so-called AI employment crisis is not a sudden "Skynet coming" disaster, but rather like DOGE, which, while flying the flag of an AI-first strategy, lays off tens of thousands of federal employees.
US College Graduates Face Joblessness
Not only that, but The Atlantic also found that the unemployment rate among recent US college graduates is unusually high recently!
Unemployment rates for recent college graduates and other groups
One likely explanation for this is that many companies are replacing entry-level white-collar jobs with AI, or rather, the funds originally used for hiring new employees are now being invested in AI tools.
Just this past May Day, this foreign media outlet discovered that the US college graduate job market has recently undergone some strange and worrying changes.
According to the New York Federal Reserve, the employment situation for recent college graduates has significantly worsened in recent months, with the unemployment rate reaching as high as 5.8%!
Unemployment rates for recent college graduates and other groups
Even MBA students who have just graduated from elite programs often find it difficult to find jobs.
Meanwhile, law school applications are soaring, which is a disturbing reminder of how young people used further education to avoid job market pressure during the financial crisis.
Regarding this phenomenon, The Atlantic contributor Derek Thompson speculates that there may be three reasons.
The first is that the youth labor market has not yet recovered from the impact of the epidemic, and it can even be said that this great recession has been going on for a long time.
Harvard economist David Deming said that it has been harder for young people to find jobs than before, a situation that has persisted for at least a decade.
The Great Recession not only led to mass layoffs but also many employers froze hiring. Just as a tech boom seemed to be coming, inflation returned, leading the Federal Reserve to raise interest rates, which directly suppressed economic demand.
White-collar industries, especially the tech industry, have been hit particularly hard. Job openings for software development and IT operations have fallen sharply.
The second theory points to a deeper, more structural shift: a college degree no longer provides the labor market advantage it did 15 years ago.
According to research from the San Francisco Federal Reserve, 2010 was a turning point, after which the lifetime earnings gap between college graduates and high school graduates stopped widening.
The third theory is the most terrifying - the weakness in the college graduate labor market may be an early sign of AI beginning to change the economy.
If you consider an economic indicator - the recent graduate gap, which is the difference between the unemployment rate of young college graduates and the overall labor force, you will find that it is no longer what it used to be.
Forty years ago, the unemployment rate for young college graduates was not high because they were relatively cheap labor.
But just last month, the employment gap for college graduates hit a record low.
It can be said that the economic environment that US college graduates are entering today is worse than any month in the past 40 years.
Law firms and consulting companies are starting to realize that 5 twenty-two-year-olds using ChatGPT can do the work of 20 recent graduates.
Moreover, even if employers don't directly replace human employees with AI, the high cost of AI infrastructure can squeeze out the share reserved for new employees.
In short, the job market for college graduates is showing a yellow light.
It's AI's Turn to Work
In short, more and more companies are now "quietly" ushering you out of your workspace.
This time, you are really going to be replaced by AI. This is not speculation, but a fact that is happening.
Thank you for your past efforts, now it's AI's turn to work.
From customer service to translation, from pricing experts to tax advisors, more and more companies are starting to hire an AI that will never complain.
Don't believe it? Look at the current status of the following 5 companies.
From 2024 to 2025, at least five well-known global companies - Klarna, UPS, Duolingo, Intuit, Cisco - have directly or indirectly laid off tens of thousands of people because "AI is more efficient".
The reason is "we are not replacing humans with AI, but just letting humans use AI to improve efficiency".
It sounds reasonable, until you find that human jobs are just gone!
Klarna
Klarna, a leading buy now, pay later fintech company based abroad, announced plans to lay off over 1,000 people in 2024, about 10% of its global workforce.
At the time, this news immediately made headlines in Forbes.
The company invested heavily in AI to handle customer service inquiries, process transactions, and optimize its operations.
Klarna built an AI assistant equivalent to the workload of 700 full-time employees.
Klarna's CEO openly discussed how AI-powered chatbots and automation systems perform tasks once managed by human agents, such as answering customer inquiries and processing refunds.
By integrating generative AI, Klarna aims to scale its services while reducing operating costs, with reports indicating that AI now handles a significant portion of its customer interactions.
UPS
In early 2025, United Parcel Service (UPS) announced plans to lay off 20,000 people, one of the largest layoffs in UPS's 116-year history.
UPS CEO Carol Tomé frankly stated that the reason behind this layoff was actually the implementation of AI and machine learning technology.
Tasks that used to require human pricing experts to write sales proposals are now handled by AI, which is more efficient and cost-effective.
Although UPS still officially claims "AI is not replacing humans", it is clear to everyone that the company has started using AI to optimize logistics routes and handle customer communication, naturally requiring fewer employees.
This move, simply put, is about the company saving money, and AI has conveniently become the most handy tool for cost reduction.
Duolingo
Duolingo announced this week plans to replace contract workers with AI and become an "AI-first company," a move that seems to indicate that the AI-induced job crisis "has arrived."
This news was publicly shared by Duolingo's Chief Engineering Officer on LinkedIn.
In an internal email posted on LinkedIn, the CEO painted a "big picture": future content production, employee performance evaluations, and even hiring decisions will all be handled by AI.
So, Duolingo made the first move and cut 10% of its contract translators, saying it was because AI was already capable of doing their work, such as automatically translating course materials, and could cover over 100 languages.
Although the company specifically emphasized: "No full-time employees were fired!" - the direction is actually very clear: AI can also do the job of translation.
Intuit
Intuit, a financial software company headquartered in California, USA, is a multinational computer software company that primarily produces financial and tax-related software.
In 2024, it laid off about 1,800 people, but this saved money was not used for dividends, but all invested in AI.
Artificial intelligence is a key component of its future strategy, especially in automating customer service, data analysis, and tax preparation processes.
The company's executives are very frank: the future focus is artificial intelligence. In the past, these tasks required a large number of employees, but now AI can handle them with one click.
Cisco
Tech giant Cisco has also joined the ranks of "AI-first" companies - previously announcing a 7% layoff, roughly 5,600 people.
The company has been integrating artificial intelligence into its network solutions, such as predictive analytics for network management and automated customer support systems.
On the surface, this is a strategic adjustment by the company, but in reality, it means that many tasks that used to require human effort can now be done by AI. Cisco's move is just a microcosm of the tech industry: using AI to replace labor, improve efficiency, and cut costs has become an industry norm.
Will Companies That Replace Employees with AI Succeed or Fail?
As early as January 2024, a Stanford University professor, Erik Brynjolfsson, said that smart companies would not use AI to replace workers or jobs.
He said that AI and humans should be used together because they each have different strengths, and AI should be "complementary" to human labor, not a replacement.
However, times have changed, and the capabilities of AI have taken another step forward.
In early 2025, many well-known global companies began intensive layoffs - for only one reason: AI has become more efficient and cheaper.
Klarna replaced 700 employees with AI customer service; UPS laid off thousands of back-office positions, shifting to automated processes; Duolingo significantly reduced its content team, relying instead on AI to generate question banks.
These companies did not choose "human-machine collaboration" but instead resolutely bet on "AI-first".
When generative AI first appeared, it was considered a good partner for humans.
But as AI has developed to this day, it seems that AI is no longer a human partner but has become a competitor, or even a replacement.
These companies are proving with practical actions that under the business logic of efficiency first and cost paramount, AI is not an "auxiliary tool" but the "optimal solution"!
This is not just a technological revolution, but a workplace earthquake.
In the past, people fantasized that AI could help workers get rid of tedious tasks and focus on creation.
The reality is - the more repetitive the work, the easier it is to be instantly killed by AI; the more procedural the position, the faster it is swallowed by algorithms.
Society may be standing at a critical point:
From AI assisting humans, to humans needing to learn to cooperate with AI;
From optimizing positions, to canceling positions;
From increasing productivity, to reshaping production relations.
And this transformation has quietly begun without waiting for everyone to be ready.
References:
https://techcrunch.com/2025/05/04/is-duolingo-the-face-of-an-ai-jobs-crisis/
https://www.forbes.com/sites/jackkelly/2025/05/04/its-time-to-get-concerned-klarna-ups-duolingo-cisco-and-many-other-companies-are-replacing-workers-with-ai/