October saw the highest number of U.S. job cuts in two decades, with consulting firm Challenger, Gray & Christmas explicitly citing AI adoption as a key driver. This data confirms that AI's impact on employment is an ongoing event, moving beyond speculation into measurable, significant job displacement.

Historically, payroll has dominated corporate expenses. As AI automates knowledge work previously done by humans, a significant portion of the budget will shift. Spend on SaaS, APIs, and model usage will grow from a small percentage to a major line item, displacing traditional labor costs.

A benchmark testing AI agents against paid freelance jobs found the best performers could only autonomously complete 2.5% of the work. This provides a crucial reality check, showing that while AI excels at discrete tasks, full job automation by general-purpose agents is still far from reality.

The narrative of AI causing widespread sales layoffs is misleading. The more significant, subtle shift is that when a salesperson quits, companies will increasingly replace that function with an AI agent rather than hiring another person. This non-backfill approach is the real force of change.

The adoption of generative AI, such as Canva's GPT integration, is first impacting freelance labor in countries like the Philippines. This trend shows accessible AI tools initially replace easily outsourced, lower-cost international workers, not domestic professionals.

While direct layoffs attributed to AI are still minimal, the real effect is a silent freeze on hiring. Companies are aiming for "flat headcount" and using AI to massively boost revenue per employee, a trend not captured in layoff statistics but reflected in record-low hiring plans.

An informal poll of the podcast's audience shows nearly a quarter of companies have already reduced hiring for entry-level roles. This is a tangible, early indicator that AI-driven efficiency gains are displacing junior talent, not just automating tasks.

Companies are preemptively slowing hiring for roles they anticipate AI will automate within two years. This "quiet hiring freeze" avoids the cost of hiring, training, and then laying off staff. It is a subtle but powerful leading indicator of labor market disruption, happening long before official unemployment figures reflect the shift.

New data from Ramp provides the first concrete business-level evidence of AI displacing labor. Businesses are reallocating budgets directly from freelancers to AI tools, with over half of companies using freelancers in 2022 having stopped entirely. The highest-spending freelance users shifted fastest, realizing 97% savings.