If AI boosts productivity so much, why would a company lay anyone off?

Question

Say hypothetically the productivity boost from AI is 2x per employee and a company has 10,000 employees.Wouldn't number of employees be a huge point of leverage?Why would you do a layoff when your 10,000 employees are now equivalent to 20,000Aren't you technically in the best possible position for growth?

minimaxir · Accepted Answer

There isn't enough work to justify 10,000 employees. There are diminishing returns.

tim-tday · Answer

Because laying people off makes more profit for the owners.

reliefcrew · Answer

> Say hypothetically the productivity boost from AI is 2x per employee
I believe this is a bad assumption. Most likely the boost is not normally distributed. So, although all employees become more productive, some employees become much more productive thereby making the others redundant.
As someone pointed out already... there are diminishing returns. In addition, there are marginal returns. Put the two together and you get ever diminishing marginal returns from the laggard employees.