In the heart of Australia’s retail sector, supermarket giants Coles and Woolworths are accelerating their embrace of artificial intelligence and automation, a move that’s reshaping operations but at a steep human cost. Recent reports highlight a surge in layoffs attributed to these technologies, with workers bearing the brunt as companies prioritize efficiency over employment stability. As of mid-2025, the duopoly’s push into AI-driven systems has sparked debates about the future of work in an industry that employs hundreds of thousands.

From self-checkout kiosks to algorithmic inventory management, these technologies promise streamlined processes and reduced overheads. Yet, stories of displaced employees are mounting, echoing global trends where AI is linked to over 78,000 tech layoffs this year alone, according to data from WebProNews. In Australia, the impact is particularly acute in retail, where Coles and Woolworths control a dominant market share, making their decisions ripple through the economy.

The Rise of Automation in Supermarket Operations

Coles has been testing agentic AI for staff leave booking, a system that automates scheduling and reduces administrative roles, as noted in recent industry updates. This follows a pattern seen in Woolworths’ distribution centers, where AI algorithms monitor worker performance down to the second, leading to disputes and strikes. A post on X from union leader Luke Hilakari described “cameras everywhere, timing every second of work,” illustrating the intense pressure on employees that has resulted in empty shelves during labor actions.

These innovations aren’t isolated; they’re part of a broader strategy to compete with global players like Amazon. However, the automation paradox is evident: while tasks become more efficient, human roles grow more demanding or obsolete. A Forrester blog post from late 2024 warned of this dynamic in Woolworths’ productivity framework, where automation heightens the criticality—and stress—of remaining jobs.

Layoffs and Worker Displacement in 2025

By July 2025, AI-driven job cuts have surged, with U.S. parallels offering a cautionary tale for Australia. Reports from OpenTools.ai indicate over 27,000 positions axed due to AI globally, a figure that’s influencing Australian retail. Coles and Woolworths have quietly restructured, with self-service technologies replacing checkout staff, as evidenced by X users lamenting the shift to “AI with a machine” in stores like Aldi, predicting similar moves by the duopoly.

Industry insiders point to economic pressures amplifying this trend. With profits soaring—Coles reported robust earnings amid inflation—companies are investing in tech to optimize costs. Yet, this has led to alarming layoffs, including in entry-level roles now automated. A CNBC article from July 2025 suggests AI’s role in job losses is underreported, with terms like “restructuring” masking the true driver.

Union Responses and Ethical Concerns

Unions are pushing back, viewing these changes as test cases for AI’s workplace integration. The Conversation highlighted Woolworths’ disputes over wearable tech and monitoring, which speed up work but erode worker autonomy. In Australia, this has fueled calls for better redundancy protections, reminiscent of Coles’ 2020 lockout over automation-related job losses.

Ethical questions loom large: as AI creates niches in areas like ethics oversight, it displaces far more in routine tasks. Posts on X reflect public sentiment, with users like Old Soldier warning that unions’ demands could accelerate robot replacements, while others decry the loss of human interaction in stores.

Future Implications for Retail Workers

Looking ahead, the trajectory suggests more upheaval. A CBS News report from August 2025 links AI to a spike in U.S. layoffs, a pattern Australian firms may follow. For Coles and Woolworths, balancing innovation with workforce needs will be crucial, especially as government scrutiny intensifies over the duopoly’s practices.

Experts argue for upskilling programs to mitigate impacts, but without policy interventions, the divide between tech adopters and displaced workers could widen. As one X post from Sky News Australia put it, the profitable giants are “doing very little to stop even more jobs from being sacrificed at the shrine of artificial intelligence,” underscoring the urgent need for a more humane approach to automation in retail.