As tech giants like Atlassian and WiseTech announce major layoffs to fund their AI pivots, the “novelty” era of AI is officially over. Discover how the shift toward reasoning models is reshaping the workforce and why being an active AI builder is now the ultimate career insurance. Report by Michael Reid OAM.
Prior to early 2025, Artificial Intelligence assistants were largely a novelty – not accurate nor reliable enough to trust with serious work. The arrival of OpenAI’s o3-mini reasoning model in early 2025 pushed the platform into genuinely useful territory. Within months, across all major AI systems, the technology became undeniably impressive. The current market unease, job cuts across many industries – not just tech – and the softening in stock market valuations of subscription software companies are not without foundation; they reflect a response to this change. Moving from useless to capable in just over a year puts AI on a frightening trajectory, and it is that speed of improvement that is causing the massive uncertainty we are seeing now.
What will things look like in 12–24 months? The honest answer is that uncertainty around the rate of change is itself the story. No one can say exactly how far or how fast this technology will move next. What we can say with reasonable confidence is that the gap between businesses that have properly built AI into how they work and those that have not will start showing up clearly in their results – not just in theory, but commercially.
The businesses using it well will simply operate differently. They will move faster, produce more with smaller teams, and deliver work at lower cost. Clients will notice that. Over time they will simply choose the leaner, quicker and more efficient operator.
Once that shift begins, the pressure on the holdouts becomes very real. It will not be some philosophical debate about technology adoption. It will be a commercial reality. And that kind of pressure forces change far faster than any internal culture program ever could.
Business owners like Mike Cannon-Brookes at Atlassian recognise the need for early action. In March 2026, Atlassian announced the elimination of 1,600 roles – 10% of its global workforce – explicitly to fund its AI push. Cannon-Brookes was direct: it would be disingenuous, he told staff, to pretend AI doesn’t change the number of roles a company needs. They have taken the gamble that AI will pick up the slack – and it will.
They are not alone. Telstra has shed more than 2,300 jobs over the past year as it reshapes its enterprise operations and moves deeper into AI. Sydney-based logistics software firm WiseTech Global announced in February 2026 that it would cut 2,000 roles – nearly a third of its entire global workforce – over two years, with its chief executive declaring plainly that the era of manually writing code as the core act of engineering is over. Across the consulting sector, the big global firms are quietly pulling back on graduate hiring as AI absorbs the routine research, drafting and compliance checking that once kept large cohorts of junior staff busy.
The Polarising Effect of AI
Within the workforce, AI has had a polarising effect. There are broadly three camps: those actively building it into how they work and multiplying their output as a result; those experimenting with it without fundamentally changing anything; and those who have not engaged at all, driven by intimidation, disbelief or simple indifference. The experimenters may be the most exposed group, because they feel enough familiarity to believe they are across it, without achieving the transformation that actually matters. The real productivity gain only comes when someone restructures how they work around AI – not merely using it occasionally when stuck.
The gap in output across these camps is already stark and it is growing. Some people are now able to produce far more work, and better work, because they have properly integrated the technology into their daily work. Others are still working largely the same way they did before.
As management teams start to see that difference clearly, the pressure will build. If a business can get significantly more output from people who have genuinely embraced the technology, it becomes very difficult to justify carrying those who have not.
At the same time, many of the systems and processes built around the old way of working will begin to look slow and unnecessarily complicated. As a result, both the people who resist the shift and the clunky structures that supported the previous way of operating will gradually be pushed aside. The change will not always be dramatic, but it will steadily accelerate.
The AI Tipping Point
The most dangerous moment for employees isn’t dramatic mass redundancy. It’s when a chief executive quietly decides not to replace the next three people who leave. No announcement, no headlines – just the steady management of a smaller headcount. That’s already happening across professional services, in government agencies quietly expanding what small teams are expected to deliver, and in mid-sized businesses where the owner has simply stopped hiring because they no longer need to.
The people who will matter in two years are those who can do the irreducibly human parts of their work and use AI to do everything else better and faster. Those who can only do one or the other will find themselves increasingly exposed.
