In a significant trend, many organizations that are rapidly reducing their workforce in the name of artificial intelligence efficiency may find themselves reversing those layoffs. A recent analysis by Forrester suggests that half of the job cuts attributed to AI may ultimately be retracted, often resulting in rehiring at reduced salaries or outsourcing.
The report, titled “Predictions 2026: The Future Of Work,” highlights a concerning pattern where companies claim to be eliminating positions due to AI advancements. However, these measures frequently end in setbacks. “Many companies claim to be cutting jobs due to AI. Some of these efforts yield spectacular failures… Other times, AI isn”t actually replacing human workers at all,” the report states. It further notes that 55 percent of employers express regret over their decision to lay off staff for reasons linked to AI.
Interestingly, a majority of executives overseeing AI initiatives—57 percent—anticipate an increase in workforce numbers within the next year, contrasting sharply with the 15 percent who foresee a decrease. The report predicts a shift in employment dynamics, suggesting that much of the work traditionally held by higher-wage employees will be handed over to lower-wage workers, often overseas or at reduced salaries.
The ramifications of these layoffs may be especially significant in the human resources sector, where the adoption of AI tools is surging. Staffing levels within HR could potentially be halved, yet the expectation remains that the same quality of service will be maintained through AI-driven talent and workforce planning systems. The report warns that many organizations may opt for vendors offering AI-enhanced products that merely provide an illusion of readiness, with only a select few able to distinguish genuine technology from ineffective solutions.
Furthermore, rival research firm Gartner has projected that over 40 percent of autonomous AI projects will be abandoned by the end of 2027, citing factors such as rising costs and unclear business value as contributors to this trend. In customer relationship management (CRM), a benchmark created by a team led by Kung-Hsiang Huang, an AI researcher at Salesforce, revealed that large language model (LLM)-based AI agents struggle with standard assessments and often fail to uphold customer confidentiality.
Some companies, including Klarna and Duolingo, are reevaluating their aggressive AI strategies, but the broader tech industry continues to experience job losses, even as leaders tout the benefits of implementing AI solutions. In September, Salesforce CEO Marc Benioff announced the elimination of 4,000 customer support positions due to the deployment of AI agents, asserting that the company no longer required backfilling these roles and was reallocating staff to other areas. This week, Amazon also revealed plans to cut 14,000 corporate jobs, attributing the decision to the increasing influence of artificial intelligence on its operational framework.
