Trump Adviser Says Companies 'Blame' AI for Layoffs Because 'It Plays Better in the Press'

A senior White House adviser has claimed that some companies may be attributing job cuts to artificial intelligence because it generates better public relations than admitting the layoffs would have happened regardless.

Michael Kratsios, US President Donald Trump's science and technology adviser, made the remarks during a recent appearance on the Moonshots with Peter Diamandis podcast, where he argued that AI is sometimes being used as a convenient explanation for workforce reductions rather than their true cause.

Concerns over AI replacing workers have intensified as companies across the technology sector continue investing heavily in artificial intelligence. Several major firms have linked restructuring efforts to AI initiatives, while executives and economists remain divided over whether the technology is already eliminating jobs at a significant scale or whether businesses are overstating its role.

Trump Adviser Questions AI Narrative Behind Layoffs

During the podcast, Kratsios suggested that some employers were using AI as what he described as a public relations shield.

'I think like a lot of folks these days like when they're doing a layoff that they would have done anyway, just like to assign it or blame it to AI because it plays better in the press,' he said.

Podcast host Peter Diamandis responded by suggesting that investors also reward companies that appear able to generate higher revenues with fewer employees.

'And their stock price goes up if they are, you know, producing more revenue with fewer people,' Diamandis said.

Kratsios replied, 'Precisely. Yeah.' Despite acknowledging that AI is changing workplaces, he expressed confidence that the technology would ultimately create more opportunities than it removes.

'I believe in the long term, I'm very optimistic about the impact that AI's going to have on jobs,' he said.

His comments show the current reality in the technology industry, where some executives argue that AI has become an easy explanation for difficult corporate decisions rather than the primary reason behind them.

AI Layoffs Continue Among Tech Leaders

The idea that businesses may be overstating AI's role in workforce reductions has gained traction among some technology leaders.

OpenAI chief executive Sam Altman raised a similar point earlier this year, saying there had been some 'AI washing' in layoff announcements. He suggested some companies were blaming artificial intelligence for job cuts that would likely have happened regardless, while acknowledging that AI is genuinely replacing certain types of work.

Business Insider reported that it has tracked 17 companies, including Uber, Snap and Block, that have cited AI as part of their decisions to reduce staff. At the same time, some economists have questioned whether the technology is responsible for the scale of job losses often suggested in public discussions.

Public anxiety over AI also extends beyond employment. Kratsios argued that repeated warnings about risks such as mass unemployment and biological threats have shaped public perceptions of the technology.

'If the only thing they're hearing from politicians and from people in the industry is that, "Oh, there's going to be a bunch of job losses and everything is dangerous, and maybe there's going to be bio risk," I think those are the things that people get worked up, and it shouldn't surprise us that the PR is bad,' he said.

Kratsios currently serves as director of the White House Office of Science and Technology Policy, a Senate-confirmed role advising President Trump on science and technology matters. Before returning to government following Trump's 2024 election victory, he worked at Scale AI after previously serving in the first Trump administration.

He also helped develop the administration's AI Action Plan, released in July, which called for speeding up permits for data centres and reducing the influence of states that impose what it described as burdensome AI regulations. More recently, Kratsios publicly accused Moonshot AI of improperly distilling its Kimi K3 model from Anthropic's Fable 5, showing his continued involvement inn the rapidly evolving AI industry.