CrowdStrike, a leading U.S. cybersecurity company, has announced plans to lay off 5% of its workforce, approximately 500 employees. The company attributes this decision to the increased efficiency provided by artificial intelligence.
CEO George Kurtz shared in a memo to staff that AI acts as a “force multiplier,” helping the company innovate at a faster pace. He explained that automation enables the company to streamline both its front- and back-office operations, reducing the need for new hires.
The announcement, which was made public through U.S. financial filings, has raised concerns within the industry.
AI Cuts Follow Global System Crash
The timing of these layoffs has sparked controversy. Last year, CrowdStrike’s faulty software update caused a global IT crash, affecting over 8.5 million Windows systems. Critical services, including airports and hospitals, experienced significant disruptions for several days.
Many experts believe the company should prioritize fixing system errors and strengthening human oversight. Toby Walsh, an artificial intelligence expert from the University of New South Wales, criticized the layoffs, calling the move “tone deaf.”
“Instead of cutting staff, CrowdStrike should focus on resolving issues from the previous crisis,” Walsh argued. “This decision sends the wrong message to employees and customers.”
Economic Pressure Behind the Decision?
Some analysts suggest that the company’s financial struggles are driving the job cuts, rather than any actual advancements in AI. In March, CrowdStrike posted a $92 million loss for the quarter, despite a 25% rise in revenue, reaching $1 billion.
Aaron McEwan, a labor market expert at Gartner, speculated that the company may be using AI as a justification for financial restructuring rather than innovation.
“Companies often claim AI boosts productivity, but the reality shows that only a small percentage of workers are actually using these tools daily,” McEwan said. “The benefits of AI have not yet materialized as expected.”
Automation’s Real Impact on Jobs
The decision reflects a broader trend within the tech industry, where AI is poised to reshape job markets. Niusha Shafiabady, an associate professor at the Australian Catholic University, noted that companies will always look for ways to improve performance and cut costs, even if it means reducing the workforce.
“AI-related job losses are inevitable,” Shafiabady said. “These layoffs reflect the reality that businesses pursue efficiency at the expense of traditional roles.”
A 2023 World Economic Forum report warned that AI and broader economic shifts will affect 23% of jobs worldwide by 2028. While the report estimates that AI will create 69 million jobs, it predicts that 83 million could be eliminated, resulting in a net job loss.
Experts Call for Ethical Use of AI
As AI continues to disrupt industries, some experts are urging companies to consider its ethical implications. Toby Walsh emphasized the importance of regulation to ensure that AI benefits society as a whole.
“More profits for companies, fewer jobs for people—this scenario is becoming all too familiar,” Walsh said. “History teaches us that unchecked automation can create societal problems. We must learn from the past.”
Aaron McEwan also suggested that companies should focus on enhancing human work through AI rather than replacing employees entirely.
“AI should empower workers, not replace them,” McEwan stated. “Companies need to strike a balance and carefully integrate AI into their processes to avoid unnecessary layoffs.”
Despite the backlash, CrowdStrike remains committed to integrating AI into its operations. CEO George Kurtz reiterated that automation would play a key role in improving the company’s cybersecurity efforts, particularly in detecting and addressing threats more quickly.
However, the company’s strategy will be closely watched in the coming months. Will CrowdStrike’s focus on AI ultimately prove successful, or will the layoffs lead to further controversy?
As the workforce adapts to new technological realities, the debate continues: who stands to benefit from AI, and who will be left behind?