Timothy DeStefano Analyzes Latest Wave of Corporate Layoffs
Posted in News
As several major U.S. employers announce significant layoffs,Timothy DeStefano, associate research professor at Georgetown McDonough and Senior Policy Scholar at the Center for Business and Public Policy, says the trend reflects a market correction following years of rapid workforce expansion, not the impact of artificial intelligence.
Speaking with Yahoo Finance about Amazon’s recent job cuts, DeStefano noted that the company’s staffing surge during the pandemic set the stage for the current pullback.
“If we take a look at Amazon, we know they hired very aggressively between 2017 and 2022, adding tons of workers during the pandemic, so I’m not surprised that there’s been a correction there,” DeStefano said.
He emphasized that the layoffs occurring across sectors including tech, retail, logistics, and telecommunications are largely driven by demand normalization and cost realignment.
“I personally don’t think there’s any connection between these layoffs and AI,” he noted.
DeStefano added that companies are adjusting their staffing to better match post-pandemic market conditions after several years of extraordinary growth and hiring.
DeStefano’s perspective reflects a broader economic reality: firms are not shedding workers because AI has displaced them, but because many overexpanded during a period of extraordinary demand and are now recalibrating their cost structures to meet more sustainable growth trajectories. His ongoing research at Georgetown, which uses observational data and field experiments to measure the causal effects of digital technologies and AI on firm performance, consistently finds that restructuring decisions hinge far more on fundamentals like demand, productivity, and organizational efficiency than on automation alone.
As companies continue to reorganize in the post-pandemic economy, DeStefano’s work provides essential evidence that helps distinguish genuine technology-driven transformation from cyclical corrections in firm behavior.
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