US tech giant Microsoft announced the implementation of a "voluntary retirement incentive" program. The target group includes approximately 60,000 employees—about a quarter of Microsoft's 223,000 global workforce—across four countries: the US, Canada, the UK, and India. This follows previous thousands-of-employees layoffs by Microsoft in April and July.

Industry insiders noted, "In most cases, companies downsize when business conditions are poor or forecasts are bleak. The fact that Microsoft is experiencing neither suggests that AI is actively replacing human jobs." This creeping reality of an "AI unemployment wave" is spreading from the US to South Korea, heightening widespread anxiety.

Despite posting a 19% year-over-year increase in revenue (reaching $92.79 billion) and a 32% jump in net income ($36.63 billion) for the July–September quarter—marking its 10th consecutive quarter of record-breaking sales—Microsoft's aggressive integration of AI has created a paradox where stellar corporate performance does not translate into job growth. Other major tech companies share a similar trajectory. Meta reported a 26% year-over-year revenue increase in the third quarter, yet its headcount remains about 20,000 lower than at the end of 2022. Alphabet, Google’s parent company, saw a 25% revenue jump last quarter while still implementing targeted buyout packages across select divisions.

AI Projected to Cut 256,000 Domestic Jobs Annually in South Korea

According to KOTRA’s Silicon Valley Trade Center, industry representatives have observed that companies are restructuring operations so that a single worker supported by AI can handle tasks previously assigned to two or three people. Data from the US outplacement firm CG&C shows that announced US AI-related job cuts surged from 4,247 in 2023 to 12,742 in 2024, and 54,386 in 2025, reaching 120,136 by September alone this year. As companies scale up AI adoption, they increasingly feel less need to maintain baseline staffing levels. The International Monetary Fund (IMF) has warned that about 40% of global jobs will be impacted by AI, while global investment bank Goldman Sachs estimates that up to 300 million full-time jobs could be automated.

In South Korea, anxiety over an AI-driven employment crisis is also mounting.

   Youth Employment Crunch: Young job seekers are finding it difficult to secure entry-level opportunities to build experience. A Bank of Korea report in August revealed that between June 2022 and June 2026, jobs for youth aged 15–29 in South Korea decreased by 285,000. A staggering 94% (268,000) of those lost jobs were in AI-vulnerable sectors like information services. As AI automates entry-level tasks such as data organization, draft document writing, and basic coding, companies have reduced their hiring of young, entry-level staff—a trend most prominent among large corporations aggressively pursuing AI adoption. Hyundai Motor, which is considering introducing physical AI such as industrial robots onto its production lines, saw its hiring of workers under 30 plummet by 67.1%, dropping from 16,551 in 2023 to 5,782 last year.
   Middle-Aged Job Insecurity: Unlike in the past, mid-career and senior workers are facing job displacement due to AI even when their companies post record profits. LG Uplus recorded its largest quarterly operating profit ever in the second quarter ($344.5 billion won, up 13.1% year-over-year). Yet, the company implemented a voluntary retirement program last year that saw about 600 employees (6% of its 10,000-person workforce) leave. LG Uplus CFO Yeo Myung-hee stated at the time that employees voluntarily participated as part of accelerated digital transformation. Although the labor union protested in April, claiming that the introduction of physical AI like "UBot" to the workplace displaced workers and deepened job insecurity, negotiations have yielded no clear agreement.

Similarly, E-Mart24 received voluntary retirement applications from management-level staff for the first time in its history last December, expanding applications to assistant managers and above starting last month—a move widely linked to the introduction of AI-based merchandising systems. Shinhan Card, which has been strengthening its AI-powered payment services, also accepted voluntary retirements through last month from employees with 15+ years of service, despite reporting a 73.7% year-over-year surge in Q3 net profit to 232.4 billion won. The banking sector, which is expanding non-face-to-face operations and downsizing offline branches via AI, also accelerated cuts: 2,364 employees left the five major commercial banks (KB, Shinhan, Hana, Woori, NH Nonghyup) through voluntary retirement between late last year and early this year, up from 1,987 the previous year.

This trend is projected to accelerate annually. The Korea Development Institute (KDI) forecasted in a July report that increased AI adoption and generative AI advancements could reduce domestic jobs by 256,000 per year over the next decade—equivalent to 2.1% of total employment in 2024. KDI estimates that 10 years from now, 8.1% of all jobs and 10.5% of total corporate revenue will be exposed to automation.

Global Responses: Shifting Focus to Reskilling

Nam Chang-woo, a senior research fellow at KDI, explained: "In the short term, we must strengthen support for job redesign and re-education in high-exposure occupations. In the medium-to-long term, we should deploy labor-complementary AI in public services and focus on building industry-specific AI governance."

International examples offer crucial takeaways. According to Bloomberg, Singapore launched an AI-related retraining program targeting all 35,000 workers in its banking sector. Local banks like OCBC and DBS are conducting AI training for all employees over the next 1–2 years, with the Singaporean government subsidizing the training costs—a strategy designed to prevent mass layoffs.

Jochen Wirtz, a professor at the National University of Singapore, pointed out in foreign media interviews: "Mass layoffs followed by re-hiring years later is highly inefficient. Transitioning skills through re-education is the path to minimizing social costs."

Hwang Yong-shik, a business professor at Sejong University, added: "AI has broken the traditional 'growth equals hiring' corporate formula, making it difficult for workers to adapt. Expanding re-education programs is essential to ensure the labor market keeps pace with rapid technological development."

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