Freshworks, Coinbase cut jobs
- Freshworks and Coinbase both announced job cuts this week, trimming 11% and 14% of staff as each company said AI is changing operations. - Freshworks said about 500 roles are going, while Coinbase plans roughly 700; one Freshworks executive said AI now writes over half its code. - The bigger shift is pay, not just cuts — scarce AI talent is getting pricier even as broader tech hiring gets thinner.
Tech layoffs are starting to split the workforce in two. One group gets cut in the name of efficiency. The other gets paid more because companies think they cannot afford to miss the AI wave. That split got a lot clearer this week, when Freshworks and Coinbase both announced double-digit job cuts and tied the moves, at least in part, to AI-driven restructuring. (money.usnews.com) ### What actually happened? Freshworks said on May 5 it will cut 11% of its workforce — about 500 jobs — as it reorganizes around the way AI is reshaping software work. Coinbase said the same day that it will cut about 14% of staff, roughly 700 employees, while flattening management and rebuilding around a more AI-heavy operating model. (money.usnews.com) ### Why are both companies talking about AI? Because AI is no longer being pitched as a side tool. It is being pitched as a reason to redesign the company. Freshworks framed the move around industry disruption from rapid AI advances. Coinbase’s Brian Armstrong tied the cuts to bot(money.usnews.com)ders. (money.usnews.com) ### Is AI really replacing that much work? In some places, yes — or at least enough to change staffing math. Freshworks gave the clearest example: executives said AI now writes more than half of the company’s code. That does not mean engineers disappear overnight, but it does mean fewer people may be needed for the same output, especially in routine software work. (qz.com) ### Or are companies using AI as cover? That is the argument starting to show up around these layoffs. Challenger data highlighted in recent coverage showed AI was blamed for more layoffs than any other reason for a second straight month in April. But critics think some companies are bundling together old problems — slow growth, weak demand, investor pressure — and giving the package a cleaner AI story. (forbes.com) ### Why does this feel different from older tech layoffs? Because the message is not just “we hired too much.” It is “the work itself is changing.” In 2022 and 2023, a lot of tech layoffs were framed as post-pandemic correction. This round is more structural. Companies are sa(forbes.com)ut the strategy is already affecting headcount. (money.usnews.com) ### So why are AI workers getting paid more? Because automation is not reducing demand for the people who build and direct the systems. WTW’s new pay data shows the U.S. is pulling further ahead on compensation for AI and digital talent. For mid-level machine learning specialists, (money.usnews.com)road roles while bidding harder for scarce technical ones. (markets.businessinsider.com) ### What does that mean for everyone else? It means the labor market is getting more polarized. Routine work looks more vulnerable. Hybrid roles that can use AI well may survive. Deep technical roles in machine learning, data(markets.businessinsider.com)argaining power. (markets.businessinsider.com) ### Bottom line? Freshworks and Coinbase matter because they made the split explicit. Companies are not just buying AI tools. They are reorganizing around them — and deciding that some workers are suddenly cheaper, while others are suddenly much more valuable. (money.usnews.com)
