Uber quietly cut 23% of its entire HR and recruiting function.

No big announcement. No press conference.

Just an internal memo from CEO Dara Khosrowshahi telling leaders the company was streamlining its people organization to reduce complexity and improve efficiency.
The cuts hit HR, talent acquisition, employee experience and workplace operations. Uber employs roughly 34,000 people globally.

Uber's official line was that this had nothing to do with AI.

That same week Khosrowshahi said publicly that Uber was hiring fewer people because existing teams were more productive with AI tools.

(Make of that what you will).

But my reaction was pretty flat.
Uber has spent years making its position on people clear.

They are replacing delivery drivers with robots. They have never been shy about pursuing driverless vehicles. So a company that has consistently deprioritized the human element cutting a quarter of its “people” team is not a surprise… It's on brand.

But here's what is worth paying attention to.

Uber’s most recent move is not a cautionary tale... It's a preview.

You see, the question is not whether this is right or wrong. The question is what it signals for every other company watching and what it means for the future of HR and recruitment.

I have worked alongside internal recruiting teams at companies of all sizes for over a decade. The honest picture is more nuanced than most admit.

Internal recruiters carry something external firms can never fully replicate. They know all the precious company details from the inside.
The culture, the vision, the politics, the unspoken qualities that make someone a genuine fit. That institutional knowledge is real and it matters.

But internal recruiting has a delivery problem that is just as real.

The pace is brutally slow and the process is often bureaucratic. I have watched high-performing agency recruiters make the transition to internal enterprise roles and struggle badly.
Not because they lost their skill, but because the environment works against everything that made them good: The urgency is gone; the accountability no longer matters; and The metrics are soft.

So, when AI can handle sourcing, screening, scheduling and initial outreach faster and cheaper than a full internal team, the value proposition of a large HR department starts to look very different.

What is happening right now is not a sudden disruption. It’s actually an acceleration of something already coming.

HR and talent acquisition teams are getting thinner. The poor performers and redundant roles go first and bloated teams built during the hiring booms of 2021 and 2022 are being dismantled.

What remains will be leaner and sharper.

And at the top of that leaner function will be the recruiters who embraced AI early and made it part of their daily workflow. Not the ones who feared it. The ones who used it as a weapon, automating the repetitive work so they could spend more time on what actually requires a human.

That combination of AI fluency and genuine human skill is the new standard. Not one or the other. Both.

But here is where most companies are getting it wrong.

They are cutting headcount without asking the harder question. If AI handles the transactional work of HR, who handles the human work?

As AI takes over the operational side, leadership is going to have to step up on the people side in ways most companies are not ready for.

It will be shaped by the CEO and by leaders in every department. Development conversations will not happen in annual reviews. They will happen in the day to day. Networking, mentorship, retention, engagement, these fall back on the people at the top of the org chart.

The companies that understand this early will build leadership capacity around it. The ones that do not will cut their HR teams, replace the workflow with AI tools and wonder why their best people keep leaving.

And high performance recruiters will not disappear.

They will become rarer and more valuable because AI has replaced the part of the job anyone could do.
What remains is judgment, relationships and the ability to read a human being. And those things do not automate.

Basically, the internal recruiter posting jobs and reviewing applications is already becoming obsolete.
The talent advisor who builds pipelines, manages relationships and consults leadership on people strategy is more valuable than ever.

If you run a company between 100 and 2,000 people, this shift is extremely relevant to you right now.

Your HR team needs to be evaluated honestly. Are they doing work AI could do faster and cheaper? Or work that requires genuine human judgment?

Your leadership team needs to start owning culture and people more directly. The era of outsourcing that responsibility is ending.

And your recruiting approach needs to evolve.
The companies winning talent in the next five years will have real pipelines, real relationships and a story compelling enough to pull A-players toward them before a role ever opens up.

HR is not becoming obsolete. The transactional version of it is.

What replaces it is not a software tool. It is leadership that actually leads on culture, on development, on the kind of environment that makes great people want to stay. AI handles the volume. Humans handle everything that matters.

See you next Tuesday.

Jared
Founder, The Hire-archy

P.S. Do you have an internal HR or recruiting function right now? Hit reply and tell me how you are thinking about its role as AI changes the equation. I read every one.

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