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Replacing staff with AI often yields negative ROI, with three-quarters of organizations finding these layoffs cost more than they saved. Rather than treating automation as a shortcut for headcount reduction, forward-thinking leaders should integrate human expertise with technological capabilities to create genuine business value. This strategic shift not only mitigates regret but also positions companies to capitalize on new growth opportunities rather than merely executing shrinkage plans.
Why replacing staff with AI backfires - and 5 ways smart leaders generate real value instead
Three-quarters of organizations have found AI layoffs cost more than they saved, and as many as nine in 10 companies would rethink them given the chance.
Follow ZDNET: Add us as a preferred source on Google. Some firms cut jobs due to AI and regret their decisions. Smart business leaders focus on value creation instead. They help professionals find new avenues to growth. Defaulting to AI-enabled layoffs is often seen as a shortcut to cost-cutting. Specialist site jobloss.ai, which tracks AI-enabled layoffs, reported that 126,000 US employees lost their jobs between January 2025 and June 2026 due to AI-related factors. Ankur Anand, group CIO at recruiter Harvey Nash, told ZDNET it's easy to see why many executives regard AI deployment as a pathway to cost-cutting. "Early messages from vendors, consultants, and even some boards have focused on productivity, automation, and doing more with less," he said. "Headlines about…
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