AI at Work: How Ottawa’s Public Service Faces Job Cuts in the Name of Efficiency
A balancing act between innovation and livelihoods as Canada’s capital tests AI-driven downsizing, highlighting recent Ottawa AI job cuts.
A New Era of Automation Hits Canada’s Capital
Ottawa, the nerve centre of Canada’s federal government, is undergoing a quiet but seismic transformation. In early 2025, federal departments began implementing artificial intelligence tools to automate everything from payroll processing to policy research. The move—pitched as a way to “modernize and cut costs”—has already triggered job cuts across multiple agencies, with more projected over the next 18 months.
Treasury Board officials describe the initiative as a necessary response to budget pressures and rising expectations for digital service delivery. “AI allows us to deliver faster, smarter public services,” said one senior official quoted by The Globe and Mail, “but we recognize the need to support workers through this transition.”
Yet behind this language of innovation lies a human cost that has many public servants, unions, and community leaders deeply concerned.
Why Ottawa Is Embracing AI—and Why It Matters
Canada’s federal workforce is one of the city’s largest employers, and Ottawa’s economy is closely tied to the health of the public service. Several factors have converged to push the government toward automation:
- Budget deficits and cost containment: After years of pandemic spending, Ottawa is seeking billions in savings.
- Global tech trends: Countries from the U.K. to Singapore are using AI to streamline government operations.
- Service expectations: Citizens now demand Amazon-level speed from public programs.
This isn’t Ottawa’s first efficiency drive. Past downsizing waves, such as the 1990s Program Review, eliminated tens of thousands of jobs. What’s different now is the pace and scope of change. AI tools can replace tasks—data entry, basic legal drafting, records management—at unprecedented speed.
“The risk isn’t just layoffs,” warns a Carleton University labour economist. “It’s the hollowing out of institutional knowledge and the weakening of Ottawa’s middle-class economic backbone.”
The Canadian government’s Digital Ambition strategy provides the framework for this shift, laying out how AI is expected to transform services while raising questions about ethics and transparency.
Human Faces Behind the Numbers
Unsung Heroes in a Time of Upheaval
While headlines often focus on algorithms and cost savings, the real story lies with the workers navigating uncertainty. Mid-level analysts, administrative assistants, and IT staff are among those most affected. Many have decades of experience and deep policy knowledge that machines can’t easily replicate.
Some departments are retraining employees for AI oversight and cybersecurity roles. But unions like the Public Service Alliance of Canada (PSAC) argue that re-skilling programs are underfunded and unevenly applied.
Public sentiment is mixed. A recent Ottawa Citizen poll found 58% of residents worry about job losses, while 42% believe AI is necessary to keep government efficient and competitive.
What’s Next: Solutions and Long-Term Impact
Experts suggest several strategies to soften the blow and ensure a sustainable transition:
- Robust re-skilling and education programs, with dedicated funding and measurable outcomes.
- Transparent AI deployment to build public trust and prevent bias in decision-making.
- Partnerships with local tech firms and universities to create new high-value jobs.
Long-term, the impact will extend beyond employment numbers. Ottawa’s housing market, small businesses, and cultural life could feel the ripple effects if thousands of middle-income salaries disappear. As one local café owner told CTV News, “Government workers are our weekday regulars. If they vanish, so might we.”
Explore More: Behind the Machines: How Abbotsford’s First Manufacturing Tour Is Forging Community Pride and Economic Momentum
A Fork in the Road
Ottawa now stands at a critical juncture: embrace AI to modernize, or risk economic and social fallout from rapid displacement. A forward-looking public service could use this moment to reinvent itself—prioritizing human judgment where it matters most and letting technology handle repetitive tasks.
As other cities and nations watch closely, the outcome here will serve as a test case for how governments worldwide can balance innovation with humanity. The question remains: Will efficiency come at too high a cost, or can Ottawa set a global standard for responsible AI adoption?
