Automation promised liberation. The current economy is delivering disruption.

Artificial intelligence (AI) was not born as the herald of a dystopia. On the contrary, its foundational promise was deeply utopian: by automating mundane and repetitive tasks, AI offers the prospect of liberating millions of workers across sectors, granting them valuable time back in their day, without sacrificing overall productivity. Yet in today's capitalist reality, that dream is being distorted by an unyielding pursuit of profit, leading to layoffs, slowed hiring, and escalating expectations on already overstretched workers.

The Utopian Vision of AI

In its ideal form, AI serves as a collaborative force, designed to shoulder routine workloads so that humans can devote themselves to creativity, empathy, and higher-order thinking. Thought leaders envision a future where advancements in healthcare, education, and knowledge accessibility become universal, reshaping society around well-being rather than toil. In this narrative, artificial intelligence is more than a tool—it is a partner in cultivating a more humane society.

Similarly, futurists like Martin Ford argue that while AI may threaten jobs, embracing economic adaptation—such as a Universal Basic Income (UBI)—can preserve social stability and entrepreneurial vigor in a post-labor world. These perspectives remind us that AI’s utopia is achievable, but only with systemic structures that safeguard workers’ welfare as automation advances.

Reality Check: AI’s Disruption of Labor

Yet reality today is more complex. According to recent reporting, major tech companies—including Microsoft, Intel, BT, and others—are cutting thousands of jobs tied to AI deployment, not solely for efficiency but because they foresee a future where human labor plays a diminished role. The financial benefits of “revenue per employee” have become the ultimate metric of corporate success, even as the human cost rises.

In India, outsourcing giant Tata Consultancy Services (TCS) recently laid off 12,000 employees—their largest-ever cut—marking the beginning of a broader AI-driven transformation across its $283 billion sector. Experts warn this could put up to half a million jobs at risk in the country’s IT workforce, particularly mid-career workers in coding, testing, or customer support roles.

In the U.S., Goldman Sachs data indicates that unemployment among young tech workers (20–30 years old) has risen by nearly three percentage points since early 2024, driven in part by pullbacks in hiring thanks to generative AI capabilities. Entry-level positions in areas like marketing, HR, or administrative support—those overlapping with generative AI abilities—are particularly vulnerable. Forecasts are sobering: AI may eliminate 6–7% of U.S. jobs over the next decade. As layoffs and hiring freezes continue, the next recession may accelerate this trend, leading to a prolonged “jobless” aftermath driven by automation, experts warn.

The Capitalist Distortion

Why such a divergence from AI’s utopian promise? At its core, capitalism demands efficiency and profit maximization. AI offers unprecedented productivity, but companies often respond by slashing labor costs or deferring hiring, rather than empowering workers with flexibility or freedom. The result is a system that values output over wellbeing, where AI serves as a mechanism to shrink labor inputs, not to enrich the human experience.

Moreover, entry-level workers—those in the earliest rungs of career ladders—are bearing the brunt of this shift. Without opportunities to grow within organizations, their pathways to stability and mobility are eroding. As seen in layoffs and hiring slowdowns, it's not just job loss; it’s also the failure to onboard and train tomorrow’s professionals.

Reclaiming Utopia: Can Capitalism Be Reimagined?

The distortion of AI’s promise doesn’t mean its utopian potential is extinguished—it suggests that the economic framework must evolve. Possible remedies include:

• Universal Basic Income (UBI) or AI dividends to distribute gains from automation broadly, upholding aggregate demand and economic inclusion—a central theme in calls to renegotiate the social contract for the AI era.
• Progressive taxation on AI-generated capital, channeling wealth toward public services, worker retraining, and human-centered innovation.
• Mandated worker reskilling programs, policies compelling firms to invest in employees rather than replace them outright.
• Recognition and elevation of human strengths - creativity, emotional intelligence, and strategic thinking, which AI struggles to replicate.

The Choice Before Us

AI was born as a liberator of human potential, not a tool of displacement. But within the current capitalist configuration, that potential is being compromised. Instead of freeing workers, AI too often acts as a lever to reduce labor and accelerate inequality. To realize a truly equitable AI future, we must intervene by reshaping economic incentives, redistributing technological gains, and empowering workers with meaningful alternatives.

 Originally Published on LinkedIn.