White House advisor says companies are blaming AI for layoffs because ‘it plays better in the press’

A top Trump official says some companies are using AI as a heat shield for layoffs.

“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,” Michael Kratsios, President Donald Trump’s science and technology advisor, said during a recent episode of the “Moonshots with Peter Diamandis” podcast.

Host Peter Diamandis added, “And their stock price goes up if they are, you know, producing more revenue with fewer people.”

Kratsios agreed with that assessment as well: “Precisely. Yeah.”

Overall, Kratsios said he’s bullish on what AI will mean for the workforce.

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

The notion of so-called “AI-washed” layoffs has gained currency among many AI executives, who have lamented companies citing AI when informing employees of layoffs.

“I don’t know what the exact percentage is, but there’s some AI washing where people are blaming AI for layoffs that they would otherwise do, and then there’s some real displacement by AI of different kinds of jobs,” OpenAI CEO Sam Altman said in February.

Business Insider has tracked 17 companies, including Uber, Snap, and Block, that have cited AI in their respective layoff decisions. The announcements come even as some economists question the narrative that AI is already causing mass layoffs. Polls show that Americans have major concerns about AI-related job losses.

Kratsios further lamented the broader dour mood hanging around AI. Inside the industry, some voices, including Nvidia CEO Jensen Huang, have begun to lash out at the so-called “doomers” whose public discussion of everything from job losses to bio-weapons has been blamed for polls showing that Americans are now deeply skeptical of AI.

“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,” Kratsios said.

Kratsios advises President Donald Trump as director of the White House Office of Science and Technology Policy, a Senate-confirmed position. Kratsios got his start working for Peter Thiel, worked in the first Trump administration, and was managing director at Scale AI before returning to the White House after Trump’s 2024 victory.

At the White House, Kratsios helped craft Trump’s “AI Action Plan,” released last July, which called for expediting the permitting process for data centers and deprioritizing states with “burdensome AI regulations.” More recently, he publicly accused Moonshot AI of improperly distilling its popular Kimi K3 model from Anthropic’s Fable 5.