The worst kept secret in the workplace is that Artificial Intelligence is arriving for office jobs, and the first visible impact is in management. A new analysis from payroll firm Gusto finds middle managers now oversee roughly twice as many workers as they did five years ago, a sign of the so called Great Flattening reported by Axios. While it is not always clear that Artificial Intelligence is directly replacing managers, cuts to those roles are freeing up resources for companies to invest in Artificial Intelligence initiatives and tools.
Big Tech has led the way. Microsoft said earlier this year it would lay off 9,000 employees, including managers, as it ramps up its Artificial Intelligence strategy. Amazon previously signaled plans to reduce the number of managers, and Google aimed to trim vice president and manager roles by 10 percent, according to Business Insider. Meta has been cutting management layers since its 2023 year of efficiency. Managers are also leaning on Artificial Intelligence themselves: Axios, citing a Resume Builder study, reports that supervisors are using tools like ChatGPT and Copilot to help with hiring, firing, promotions and raises, which signals to executives that fewer people may be needed to manage teams.
The productivity picture is mixed. Gusto’s analysis suggests industries with more human managers have had better productivity for now, though that could be a temporary effect as companies adapt to new workflows. Several executives are forecasting deeper disruption ahead. Ford CEO Jim Farley said at the Aspen Ideas Festival that Artificial Intelligence will eliminate half of white collar jobs in the United States. Amazon CEO Andy Jassy told employees that broad Artificial Intelligence adoption will shrink the company’s corporate workforce over the next few years, even as some new roles emerge. Anthropic CEO Dario Amodei warned in May that Artificial Intelligence could wipe out half of entry level white collar jobs and push unemployment as high as 20 percent within five years.
Those entry level roles, along with middle management, are crucial stepping stones. Aneesh Raman of LinkedIn wrote in a New York Times op ed that Artificial Intelligence is eroding the bottom rung of the career ladder, from junior coding and debugging to document review and customer service, potentially depressing earnings for years for those who struggle to get a foothold. Not everyone agrees on who benefits first. Brad Lightcap of OpenAI told the New York Times that younger workers may adapt faster, while MIT economist Danielle Li cautioned that Artificial Intelligence can democratize specialized skills, making some experienced roles easier to cut and raising the bar for new graduates in a tighter market.
Adoption remains early but is accelerating. According to the U.S. Census Bureau’s Business Trends and Outlook Survey, business use of Artificial Intelligence has more than doubled since 2023, from 3.7 percent to 9.2 percent, and planned adoption has climbed from 6.3 percent to 11.6 percent. The direction is clear even if the current share of active users is still relatively modest. For now, companies are flattening org charts, experimenting with automation in management tasks, and preparing for a broader reconfiguration of white collar work.
