Key Takeaways
- Educational technology company Chegg announced it would be laying off 45% of its workforce, which amounts to 388 employees.
- The decision comes in response to “the new realities of AI,” according to Chegg.
- Chegg is just the latest company to substantially reduce its workforce because of artificial intelligence technology.
It turns out that AI is absolutely going to take your job, with educational technology company Chegg announcing massive layoffs and citing the “new realities of artificial intelligence” as the primary reason.
We all knew that AI would shake up the business world in a major way. The technology has proven quite adept at performing specific tasks to improve productivity, even if some companies aren’t seeing a return-on-investment.
Unfortunately, in the short term, that means that the tech industry is laying off employees like never before, and workers at Chegg are tragically the latest victims.
Chegg Announces Layoffs
In a statement from the company, Chegg announced that it would be “restructuring” the business, which translates to 388 employees being laid off. That number represents 45% of the company’s workforce.
These are not the first round of layoffs for Chegg either. In the last year alone, the company has gone through multiple rounds of layoffs that have seen 441 employees let go in May and 319 jobs removed in January.
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Chegg notes in the statement, however, that the decision will reduce expenses “by approximately $100-110 million,” so hopefully that makes the fired employees feel a bit better.
Why Is Chegg Laying Off Employees?
Obviously, saving money is always the goal of layoffs. In the Chegg statement, however, the company goes a bit more in-depth, explaining that the current situation in 2025 demands a leaner business model.
“The new realities of AI and reduced traffic from Google to content publishers have led to a significant decline in Chegg’s traffic and revenue. As a result, and reflecting the company’s continued investment in AI, Chegg is restructuring the way it operates its academic learning products.” – Chegg statement
In so many words, Chegg is prioritizing AI over its employees in hopes of using the technology to close the gap in a more affordable way moving forward. And trust us, they are not alone.
Tech Industry Layoffs for AI
Chegg is not the only company firing employees to make room for AI. In fact, the trend has been seriously picking up steam over the last few months, with huge companies making massive cuts to free up capital for AI investment.
Just this week, for example, Amazon was rumored to be considering a 30,000-employee culling that would represent one of the largest in the company’s history. On top of that, companies like Meta, IBM, Salesforce, and many others have admitted that AI is making them reconsider the current state of their workforce.
Simply put, AI is having a huge impact on the business world. More specifically, it’s putting millions out of work with little return-on-investment, paving the way for one of the biggest bubble pops in history.
