The Great Replacement of White Collar America
555: Citadel's AI Push, Layoffs, What The Future Holds
Morning.
Hope everyone had a solid weekend and okay Monday.
As I said last week, we had a few subscribers ask for us to revert back to one of our traditional Arb Letter “development” guides.
In the past, something that helped drive a large amount of engagement (and good reception) from readers were the classic guides I’ve done on everything from dating to personal development to how to evolve in a changing world.
Today we’re expanding on the concept of replacement.
Now anybody worth their salt (who reads me or others like me) is aware of the great replacement theory when it comes to immigration.
What was once dismissed outright as fringe rhetoric has increasingly moved into mainstream political and policy discussions. Recently, the United States rejected a UN migration declaration, citing “replacement migration” and broader efforts tied to demographic restructuring across Western nations.
It is undeniably a phenomenon present only in Western countries. The UK, rampant with culture clashes in the last several years, had a MASSIVE demonstration related to immigration just this past week.
Regardless of where you fall politically, the reality is that mass migration, collapsing birth rates, aging populations, and labor shortages are reshaping the economic, cultural, and political future of the West in real time. We will expand on this again in due time…..
But while most people remain fixated on this outlandish demographic replacement, another form of replacement is unfolding much faster and arguably with even larger implications for the average person.
White collar America is now staring directly into its own replacement cycle.
The same system that spent decades promising stability through degrees, corporate careers, and comfortable office jobs is quietly beginning to automate, compress, outsource, and eliminate the very people it was designed to produce.
And unlike some previous technological disruptions, this one is not coming for truck drivers, factory workers, or cashiers first (though it will come for them eventually).
AI is coming for the laptop class quickly.
Lawyers. Analysts. Recruiters. Marketers. Junior coders. Customer service teams. Designers. Researchers. Account managers. Bankers. Consultants. Middle management.
Entire layers of administrative and coordination work that large language models and AI agents are increasingly able to perform faster, cheaper, and at scale.
The trend is accelerating this week. We just got news that META 0.00%↑ plans to lay off more than 8,000 team members this Wednesday, telling employees to work from home. The tech company said they are slashing managerial roles as a part of the cuts.
Polymarket odds are on the move with a 85% chance tech layoffs keep pumping in 2026. No chance this over yet.
The world has changed immensely in the last 10 years or so. Beyond the social, political, and geopolitical changes, now we find a crisis right where it hurts people most.
Their livelihood and means of making a living (in an already cost heavy and inflationary environment). Corporate teams are being asked to help implement agentic AI into existing workflows (digging their own grave).
People who previously thought their jobs were safe are finding themselves unemployed without options over night. Young people literally have no options out of school.
Entire categories of knowledge work are being forced to compete not only against lower cost global labor (H1-B explosion), but against software that never sleeps, never asks for a raise, never burns out, and improves every quarter (or week at this rate lol).
To be clear, I am not writing this as some apocalyptic anti-technology rant.
AI is not going away. The productivity gains are real. The opportunities are enormous.
Some people and businesses are going to become extraordinarily wealthy and effective because of this transition.
But pretending this shift is not happening, or assuming your particular role, degree, industry, or company is somehow exempt, is increasingly becoming a dangerous bet in my opinion.
So what do you do?
How do you position yourself in a world where replacement is no longer just a political talking point, but an economic and professional reality beginning to touch millions of people?
That’s what we’re going to unpack today. Let’s get it.
I went home one Friday actually fairly depressed by this because you could just see how this was going to have such a dramatic impact on society.
— Citadel’s Ken Griffin on the impact of AI on jobs
Alarm Bells Sounding
There’s been this dichotomy when it comes to AI and job replacement over the past year or so. Some think that this is the beginning of the end for meaningful employment people in all kinds of sectors.
Others have said for months that it is all overblown.
Reality, as usual, is probably somewhere in the middle. But the warning signs are getting harder and harder to ignore.
Over the last several months, major firms across technology, finance, consulting, media, software, and customer support have increasingly pointed toward AI as a direct driver of leaner teams, reduced hiring, or outright workforce restructuring.
Microsoft recently announced another major round of layoffs while aggressively scaling internal AI deployment and automation initiatives.
Google, Amazon, Salesforce, IBM, and others have all made public comments over the last 12–18 months about efficiency gains from AI, flatter organizations, and the ability to accomplish more with fewer employees.
Comments or discussions are one thing, layoff announcements are another, and they are beginning to stack up.
Standard Chartered announced plans to cut more than 7,000 jobs by 2030 while expanding AI and automation across back-office and support functions. As noted in the intro, META is culling big time this week, letting go of about 7,000 to 8,000 people. In regards to META:
Employees will be moved to four new organizations focused on building new A.I. tools and apps, Janelle Gale, Meta’s head of human resources, said in an internal memo. The organizations will use “A.I. native design structures” and have fewer managers per employee than other parts of the company, she said, adding that company leaders will send details about the new roles on Wednesday.
— New York Times
Starbucks announced 250 corporate employees will be laid off starting July 17. ZoomInfo, Kraken, Cisco, Dell, and Amazon have paved the way in 2026 with layoffs of their own as well.
So the pressure is building.
In my humble opinion, we have passed the threshold of “will AI pose a real and timely threat” to white collar jobs. It is very much here and it is happening more quickly than people realize.
One of the major developments in the last couple weeks came from Citadel’s Ken Griffin. Citadel manages roughly $68B. It’s never good when one of the most successful hedge fund managers of all time, who spends his time trying to hire the smartest people on earth, tells you that he went home depressed after beginning to understand the implications of AI on his workforce.
Griffin said the following last week.
“Number one is, in the last few months, there has been a step change in the productivity of the AI toolkit. It is profoundly more powerful than it was just nine months ago.
And for us at Citadel, that has allowed us to unleash a much broader array of use cases for AI. And it has been really interesting to watch, to be blunt, work that we would usually do with people with masters and PhDs in finance over the course of weeks or months being done by AI agents over the course of hours or days.
These are not these are not mid-tier white collar jobs. These are like extraordinarily high skilled jobs being, I'm going to pick a word, automated by agentic AI. And I gotta tell you, I went home one Friday actually fairly depressed by this because you could just see how this was going to have such a dramatic impact on society.
When you witness it in your own four walls, when you see work that used to be man years of work being done in days or weeks, it's like, wow, like that's the first time I've seen real impact in our four walls.”
We’re not talking your average fresh out of school analyst getting his job taken by AI, we are talking about PHD holders and scientists being displaced……
What does that mean for your vanilla corporate worker?
Nothing good.
It’s worth noting that the pushback AGAINST AI is very telling as well. Public opinion is drastically turning negative.
Former Google CEO, Eric Schmidt was booed at the University of Arizona graduation ceremony/commencement speech when he began to talk about how AI will touch all jobs. In response to the boos Schmidt said, "There is a fear in your generation that the future has already been written, that the machines are coming, that the jobs are evaporating, that the climate is breaking, that politics are fractured, and that you are inheriting a mess that you did not create."
Same thing happened at Glendale Community College. Some students reported their names being skipped and the president took to the stage to explain it was because of new AI name-reading system they were using.
Initially she told them (in her best corporate HR style) that they couldn’t walk across the stage again properly but after booing and pressure they were allowed to.
Can you imagine lol?
Same thing happened at Middle Tennessee State where music executive Scott Borchetta was speaking and smugly telling students to “deal with it”.
We’ve covered the mass pushback against data center build outs as well. Communities have pushed back over enormous electricity demands, water consumption, land usage, environmental concerns, noise, and fears about strained local infrastructure.
We have billionaire hedge fund managers privately worrying about what this means for highly skilled labor.
We have students openly hostile to being told their future careers may be partially automated before they even begin.
We have communities resisting the physical infrastructure required to power the AI economy.
Let’s just call it like it is, this is not normal skepticism, this is a broad societal signal and importantly, none of this resistance appears to be slowing deployment at all lol.
Capital spending is exploding. Corporate adoption is accelerating.
The machine is moving forward anyway.
Hedging Against All of This & What To Do
Now some have highlighted (especially in the case of Microsoft) that the AI layoff story is a cover to allow the H1-B scheme to continue at full tilt. That may be true in part or, as others suggest, this might still be the perfect excuse to continue culling the herd after over hiring sprees during COVID.
I don’t think we can fully attribute the layoff trends to any one of these themes but the bottom line is does it matter?
The layoffs are happening. I’ve already heard from friends at all sorts of companies that management teams are asking them to begin implementing AI into existing workflows (know where that inevitably leads?).
Where will those 7,000 people laid off by META go? Another company that is weeks away from their own layoff announcement?
It does nothing to sit and bitch about a problem without trying to formulate a solution so here’s mine for you.
The days of cushy corporate roles with high security are completely over. In my 9 years in corporate the amount of clowns I met who held roles nobody could even explain or define was truly unbelievable. Many of these roles went hand in hand with DEI initiatives (which isn’t surprising) but my point is the amount of fluff was laughable, truly.
The sheer number of USELESS middle managers was mind blowing.
Being front office/sales most of my career, I had numbers to hit. If I didn’t hit the number I got canned. But these other roles I describe were esoteric and subjective. Redundant to an absurd degree.
They paid well! And if you could get one it was great! But I those days are likely long gone.
So what now?
If you are young understand that producer roles are safest for now. AI cannot take over a sales position and client book seamlessly by end of this year. Alternatively if you’re a math geek or brainiac you can take the approach of trying to be the best engineer possible, but if you take this route you MUST be a Swiss Army knife. You must know the layout of the AI landscape and how to optimize it, harness it, and deploy it
If you are young think long and hard about the specific industry and role you want post college. Long gone are the days a random history or communications major bags a cushy corporate role straight out of school
Not many could’ve predicted how aggressively this AI trend was going to play out (definitely not me). My long standing advice of building a business or side hustle hits doubly as hard now. I did it because I didn’t want to work in corporate forever. Now, it’s a well welcomed hedge against white collar work into the future. Stop delaying this. Give yourself options and flexibility given this uncertain climate
Lean into this tech. AI is not going away. There are 14 years olds vibe coding and leveraging AI like experts. You can get mad and stay skeptical but while you do that there are people learning to harness the power of this absurd digital beast to benefit themselves
Do not assume if you are a manager or middle manager you are safe. In the case of META, those folks were targeted first
Consider building skills that exist in the physical world. This may sound odd in a discussion centered around white collar work and AI, but there is a reason electricians, plumbers, mechanics, nurses, firefighters, pilots, operators, and skilled trades remain harder targets for immediate disruption. If you are up for a career change or want to try something new this isn’t a bad bet
Own assets, audiences, or leverage. This lesson matters more than ever. If your entire economic existence depends on selling hours into a single employer relationship, you are more exposed than you may realize. Building an audience, business, investment portfolio, intellectual property, niche expertise, digital product, real estate exposure, or ownership stake creates optionality. You want systems that can generate value even when labor markets become more volatile. In a world of accelerating automation, ownership and leverage matter more than ever (hint - this goes hand in hand with starting your own business)
Axios reported this week that “For 70 years, a bachelor’s degree was the most reliable on-ramp to a stable career. That’s no longer true”. Haven’t had a chance to read the full article but I agree. I don’t know how many of our readers here are still in college or younger, but college has lost much of its allure in past years.
Think about it.
Unless you are going for engineering, medicine, law, or some other hyper specialized discipline, what’s the point? Even for those fields, in 10 years, things could look very different.
I looked at my 3 year old son the other day playing in the yard and thought to myself “what is he actually going to be able to do when it comes time for him to start a career?”.
It’s wild to think about.
We will continue to talk about these shifts, but I think with recent headlines it was worth pointing out that it appears we’ve passed a milestone. For better or for worse, AI continues to be the culprit and scapegoat behind more and more layoffs and we need to adjust if we sit in the path of this massive technological shift.
If you want some more tips and pointers to become more sovereign, prepare some side hustles, etc. check out our top rated guides below:
The 2026 Blueprint: Survive the Chaos, Profit From the Future
Adapt Or You Will Fall Behind
Markets Review
Quick run down of the top market headlines from today and yesterday:
Japan’s 30-year yield made a new all-time high this week
Michael Saylor’s Strategy bought another 24,869 BTC for about $2 billion
The 30-year Treasury yield has soared to 5.13%, the highest level since 2007 (Polymarket)
The odds of the Fed hiking interest rates in 2026 surge to a new high of 35% (Kobeissi Letter/Polymarket)
Japan officially now recognizes foreign-issued crypto stablecoins as legal electronic payment methods starting June 1 (WatcherGuru)
KPMG is integrating Anthropic’s Claude across its core business and 276,000+ workforce (CoinTelegraph)
Hope this was good food for thought kings.
I think we would all be better served taking many of the latest signs we see in corporate, traditional realms of work, and life more seriously. The changes seem now like they will end up being pretty impactful on work, labor, and the future job landscape for us and for our kids.
We will be back on Thursday with a markets review for paid subs.
See you on Discord and X.
Andy
Hiring for software engineers is rapidly increasing, not decreasing. This is from Citadels own research who you reference in the article.
You also didn’t mention the recent Gallup survey in which 89% of executives say AI has not boosted their companies labor productivity, which implies that either AI doesn’t work, or hasn’t even been implemented properly yet in most businesses. You don’t just buy Claude licenses and connect it via API and get value / efficiency Lmao
Way too doomer.
Restructuring super bloated companies (Oracle in particular is a comically bloated company where sales people can hit less than 50% for YEARS and stay employed) in order to be competitive with new technology is not the same thing as “replacement”.
H1B —> that’s actual replacement in most cases
A lil bit too doomer bro. I hope what Jensen is saying is true. I'm tired of hearing the takes from Dario and Sam. Unfortunately, I heard what Ken Griffin said.
Funny thing though is the people who hate AI the most are the ones that don't even wanna work.
Hopefully one day we get to work less, and if we still work, it's something more fulfilling in life.
Human's have been around for a long time, and we've never been working harder than we have in the past 30 years.
Al Bundy couldn't comprehend today's worklife.