ZDNET’s key takeaways:
- Organizations cutting roles due to AI implementations are experiencing regret over their decisions.
- Forward-thinking leaders prioritize strategic value creation over immediate cost reduction.
- They focus on empowering professionals to explore innovative growth opportunities.
Defaulting to AI-enabled layoffs is often viewed as a shortcut for cost efficiency. According to jobloss.ai, a platform tracking AI-driven staff reductions, 126,000 U.S. employees lost their jobs between January 2025 and June 2026 due to AI factors. Ankur Anand, group CIO at Harvey Nash, noted that executive messaging from vendors, consultants, and some boards has emphasized productivity and automation, reinforcing the belief that eliminating staff is the fastest route to value. This approach creates uncertainty among professionals facing AI-related job displacement.
Businesses Regret Job-Cut Decisions
Replacing workers with AI lacks a guarantee of success. Research from Careerminds indicates that organizations often discover AI-driven layoffs do not yield the expected value. Three-quarters of companies found such cuts cost more than they saved, with nearly 90% expressing willingness to reverse these decisions. Analyst firm Gartner projects that 50% of companies citing AI for headcount reductions will rehire employees for comparable roles by 2027. These outcomes highlight how cost-centering strategies may undermine innovation and long-term growth.
Anand emphasizes that firms treating AI as a cost-cutting tool risk overlooking broader opportunities. “AI strategy should align with growth, not just headcount reduction,” he states. “Leaders who thrive will leverage AI to create value, not merely cut expenses.”
<
Expanding Beyond Cost Reduction
Steve Lucas, CEO of Boomi, argues that many AI-related layoffs are mislabeled, often driven by opportunistic restructuring rather than necessity. While AI will impact jobs, he cautions against overattributing staff cuts to the technology. “AI is a convenient scapegoat for decisions already made,” Lucas asserts. He advocates for cautious optimism, noting that early AI adoption phases are still evolving, and companies should instead focus on empowering teams through technological and human collaboration.
<
Lucas adds, “AI will increase societal productivity and health. We’re in early days—those who embrace it thoughtfully will lead the way.” His outlook contrasts with sensational claims about AI rendering work obsolete, emphasizing strategic partnership between humans and machines.
Stephen Wood, COO of Rathbones Asset Management, sees AI as complementary rather than replaceive. In legal and financial sectors, while AI can automate tasks like document review, he stresses the irreplaceable role of human expertise. “You still need experts to act in court or advise clients,” Wood explains. For him, AI enhances rather than eliminates the need for skilled professionals, enabling them to focus on higher-value work through upskilling.
<
Generating New Business Value
Tim Chilton, a geospatial consultant at Ordnance Survey, champions strategic AI integration. His team uses Snowflake’s agentic AI to provide employees with instant access to data via chatbots, reducing information retrieval from days to minutes. “Our goal is to empower staff, not replace them,” Chilton says. Employees actively shape AI’s role in their workflows, balancing human and machine contributions. This approach ensures technology enhances productivity without diminishing human input.
<
Chilton notes that user-driven AI adoption fosters innovation while maintaining control over technological limits. “Snowflake sets constraints to prevent overreliance on AI,” he explains. “We’re learning where AI adds value and where it doesn’t belong yet.”
Five Strategic Priorities for AI-Driven Value Creation
Anand recommends leaders focus on these key areas to maximize AI’s potential:
- Prioritize workforce retention: Avoid indiscriminate layoffs, which risk losing institutional knowledge and stifling future innovation.
- Redesign processes: Reshape roles to leverage AI for routine tasks while elevating human contributions in creativity, critical thinking, and relationship-building.
- Measure multifaceted value: Track metrics like cycle times, quality improvements, revenue growth, and risk mitigation—not just cost savings.
- Upskill employees: Invest in training to equip staff with AI collaboration skills and create new roles that merge human and machine capabilities.
- Embrace AI as a growth catalyst: Position technology as a platform for expansion rather than a tool for cutting staffing levels.
Ultimately, Anand concludes, “The question is not whether AI will reduce costs—it will. The true measure of success is whether you’ll use it to build something greater than what exists today.”
