Barely a week goes by without another headline. Tech giant cuts 3,000 jobs. Bank automates back office, 800 roles gone. Retailer rolls out AI, reduces headcount by a third. The numbers are real and the pace is accelerating.
If you run a small business, you are watching this and wondering where it leaves you. Do you automate and risk doing the same thing to your own team? Or do you hold off and hope the wave passes?
Here is what I actually think is happening. And why the lesson for NZ SMEs runs in the opposite direction to what most people assume.
The mass layoffs are not about AI. They are about a debt that was building for years.
When a company announces it is cutting 5,000 people because of automation, the story that gets told is: AI arrived and took those jobs. But that is not quite right.
The more accurate story is: those companies spent years building their headcount on work that should never have required a human. Repetitive processing. Manual data entry. Rule-based decisions that follow the same logic every single time. They hired people to do those things because the technology to replace them did not exist yet, or was not affordable, or they simply never got around to fixing it.
When AI became capable enough to handle that work, the redundancy was already baked in. The layoffs are not AI creating a new problem. They are AI exposing a problem that was always there.
The companies doing mass cuts built fragile operations. They centralised manual work into large teams instead of systematising it. And now they are paying for it in headlines and severance packages.
I watched this cycle long before AI was part of the conversation
I spent over a decade working across businesses in Singapore, the Middle East, and Southeast Asia. Different industries, different sizes, different cultures. The pattern was the same everywhere.
Companies would grow by hiring. Headcount would expand to meet demand. Then the market would shift, or the margins would compress, or a downturn would arrive, and suddenly there were more people than the business could sustain. Retrenchments would follow. Good people who had done nothing wrong would lose their jobs because the business had been built in a way that made them structurally vulnerable.
That experience is a big part of why I started Octawerks. Not because I think people should be replaced by machines. Because I think good people should not be put in positions where their jobs depend entirely on the business never having a better option.
When a role is built around tasks that a system could handle, that role is always one technology cycle away from disappearing. That is not a safe place to put someone.
For small businesses, the risk runs the other way
Here is where NZ SMEs sit differently to the large corporates making news.
You do not have 5,000 people doing repetitive data processing. You have a small team, probably wearing multiple hats, probably stretched. Your risk is not that you will automate too much and end up with too many machines. Your risk is that you will not automate enough and end up burning out the people you cannot afford to lose.
When one person handles booking confirmations, invoice chasing, quote follow-ups, supplier coordination, and customer communication manually, every one of those tasks is a failure point. They get sick, the system stops. They leave, you lose the institutional knowledge of how everything was held together. They burn out quietly and their work degrades before you even notice.
Automating the routine parts of those roles does not eliminate them. It makes them sustainable. The person stays. The business becomes less fragile. And the work that actually requires a human gets the attention it deserves.
The businesses that will face their own retrenchment moment
They are the ones hiring now to solve problems that are actually systems problems. Building headcount on manual work that could be automated. Creating roles that exist only because no one has set up the workflow to handle it automatically.
When the pressure comes, and it always does, those businesses will face a version of the same choice the corporates are facing now. Cut costs fast, or absorb them and hope. Neither option feels good when the people on the other side of it are your team.
The businesses that will not face that moment are the ones building lean from the start. Automating the routine, keeping the team focused on work that genuinely needs them, and never building a role around tasks that a system should own.
This is not a comfortable conversation
I am aware that talking about automation while people are losing jobs to it can land badly. So I want to be straight about where I stand.
I do not think AI and automation are neutral forces that just happen to people. I think the way they get deployed matters. Automating to free your team up for better work is a different thing from automating to cut costs and extract more from fewer people. The technology is the same. The intent is not.
What I believe, based on what I have seen across more than a decade in business, is that humans are genuinely better than machines at a lot of things. Relationships. Judgement. Creative problem solving. Reading a room. Those things are not going anywhere. But filling in the same form 200 times a week? That was never a good use of a person.
What do you think?
This is a topic people feel strongly about and I think the conversation is worth having honestly. So I am genuinely curious: how are you thinking about AI and automation in your own business? Are you worried about what it means for your team? Have you already made changes and seen the impact, good or bad?
Drop a comment below. I read every one and I will reply.
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