Ride-hailing giant Uber (UBER) has announced a significant workforce reduction within its human resources division, part of a broader push to streamline operations and improve efficiency.

The company is cutting 23% of its People and Places department, which handles HR, recruitment, office space, and culture. The layoffs affect dozens to potentially over a hundred employees, a figure that represents "well under 1%" of Uber's total workforce of 34,000.

In a communication to the affected teams, Uber's new President, Jill Hazelbaker, explained the rationale. She stated that some teams had become "complex and fragmented, with overlapping responsibilities, unclear ownership, and teams too far removed from the businesses they support." The goal of the restructuring, she said, is to build a "more connected, modern, and operationally excellent organization."

CEO Dara Khosrowshahi echoed this sentiment in a separate memo to management, calling the changes "essential to maximizing the effectiveness of our People team and our huge potential for the future."

Notably, Uber has explicitly stated that this round of layoffs is not related to artificial intelligence. This stance contrasts with many other tech firms that have cited AI-driven efficiency gains as a reason for job cuts this year.

In a parallel move highlighting the financial pressures of the AI era, Uber has also implemented a new spending cap on AI tools for its employees.

The company has set a monthly limit of $1,500 per employee for each AI programming tool, such as Anthropic's Claude Code and Cursor. This policy shift was prompted by a startling discovery: the company's entire annual budget for AI had been exhausted within just the first four months of the year.

Previously, Uber had encouraged widespread experimentation with AI tools with few financial restrictions. The rapid budget depletion forced a reevaluation, leading to the new "soft limit" system, where employees can track their usage and request exceptions for specific business needs.

These two initiatives—restructuring the HR department and capping AI tool spending—represent different facets of the same corporate imperative. Uber is navigating the challenges of the AI age by enforcing stricter financial and operational discipline across its organization, seeking a balance between innovation investment and cost control.