US tech industry warns of AI leadership crisis amid government agency cuts

The US tech industry is voicing strong opposition to recent cuts at science and tech agencies, with concerns about the long-term impact on AI development and the broader tech ecosystem.

Industry leaders and advocacy groups sent a letter to Commerce Secretary Howard Lutnick, warning that continued downsizing could undermine America's global leadership in AI, Caliber.Az reports citing foreign media.

The letter emphasizes that President Trump's first term marked a pivotal moment for AI work at the National Institute of Standards and Technology (NIST). NIST has been instrumental in developing standards, fostering public-private collaboration, and harmonizing international norms for AI.

"We caution that downsizing NIST or eliminating these initiatives will have ramifications for the ability of the American AI industry to continue to lead globally," the letter stated. The groups urged for a strategic approach that aligns NIST's expertise with security and economic imperatives to maintain US leadership in emerging technologies.

The Software & Information Industry Association, TechNet, and Americans for Responsible Innovation (ARI) were among the signatories, adding their support to NIST and the National AI Research Resource. Meanwhile, ARI expressed further concern after 73 probationary NIST staff were fired last week, highlighting the cuts’ impact on crucial research and talent. Similarly, the National Science Foundation (NSF) terminated 170 employees in February, many specializing in AI and computer science.

Although some staff were reinstated following a federal ruling, these cuts contribute to an ongoing reshaping of science and tech agencies under the Trump administration, which claims the cuts are necessary to address waste and inefficiency. However, experts argue that these reductions jeopardize long-term research, such as NSF’s funding of high-risk studies that may later lead to breakthrough applications.

"The pipeline that gets young talent into big tech and startups is in many cases coming from NSF funding grants," one NSF employee stated. With STEM talent already scarce, the cuts risk exacerbating the issue and affecting the future of US technological dominance. Universities have also reacted, with some pausing graduate student admissions due to uncertainty over future funding.

By Vafa Guliyeva