August 5, 2025
5 min read
Eric Hastings
McKinsey deploys 12,000 AI agents, cutting 5,000 jobs and driving 40% revenue growth, while Elon Musk doubts AI will soon replace consultants.
McKinsey’s AI Agents Cut 5,000 Jobs and Boost Revenue by 40% Amid Musk’s Skepticism
Written by Eric Hastings Monday, August 4, 2025McKinsey’s Bold Bet on AI Agents
McKinsey & Co. has deployed 12,000 AI agents to streamline operations, marking an "existential" shift in the consulting industry. These AI tools handle tasks ranging from data analysis to drafting reports, fundamentally changing how consultants deliver value to clients. According to a TechRepublic report, McKinsey aims for a one-to-one ratio of human consultants to AI agents, reducing reliance on junior staff for routine work. Kate Smaje, McKinsey’s senior partner overseeing AI initiatives, told The Wall Street Journal that while this transformation raises existential questions for the profession, it ultimately represents an "existential good." Team sizes on some projects have shrunk from 14 analysts to just two or three humans augmented by AI swarms, resulting in about 5,000 job cuts. This efficiency has helped AI contribute to 40% of McKinsey’s revenue, signaling a shift toward outcome-driven consulting rather than traditional slide-heavy presentations.Elon Musk’s Skeptical Take
Elon Musk, CEO of Tesla and xAI, offered a contrarian view, stating AI won’t replace consultants anytime soon. On X (formerly Twitter), Musk noted that CEOs often hire consultants to validate decisions they’ve already made and to serve as scapegoats if things go wrong. As reported by Mint, Musk’s perspective highlights the human element in consulting — the nuanced role of external validation and blame diffusion — which AI may struggle to replicate. This commentary comes amid broader industry changes where AI threatens entry-level analysis and research jobs. McKinsey’s strategy, including tying partner compensation to AI adoption, shows how top firms are reshaping client interactions, hiring, and project scopes. Musk’s point resonates: while AI excels at speed and scale, strategic advisory often depends on interpersonal dynamics and accountability that technology alone cannot replace.Broader Implications for Consulting
The consulting sector, dominated by firms like McKinsey, Accenture, and Deloitte, faces pressure to evolve or risk obsolescence. Reports from Hindustan Times suggest Musk’s influence could extend to government reforms, applying tech efficiency principles to federal operations and challenging traditional consulting models. Meanwhile, AI’s integration raises ethical debates. A New Yorker analysis questions whether AI will concentrate wealth and disempower workers. For industry insiders, McKinsey’s approach offers a blueprint: embrace AI as a force multiplier rather than a replacement. Social media posts reflect growing sentiment that junior roles are disappearing, with AI handling 90% of benchmarking and trend analysis. Yet, as Musk implies, the human touch in confirming executive biases may preserve consulting’s core for years.Navigating the Existential Good
Looking forward, McKinsey plans to balance its human-AI mix, focusing on high-value outcomes like strategic risk identification. This shift could redefine success metrics, moving from billable hours to measurable impacts. Industry observers note that while AI automates routine work—echoing Musk’s recent comments in Mint about coding jobs—the consulting profession’s resilience lies in its advisory essence. Ultimately, this transformation invites a reevaluation of value in professional services. The interplay between AI efficiency and human judgment will determine who thrives in this new era, with McKinsey leading the charge and skeptics like Musk reminding us of enduring human frailties.Source: Originally published at WebProNews on August 4, 2025.