AI isn’t paying off in the way companies think. Layoffs driven by automation are failing to generate returns, study finds
Jake Angelo
Updated Tue, 12 May 2026 at 12:33 AM SGT
4 min read
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A Gartner study found that while 80% of companies surveyed reported workforce reductions, there was no correlation to higher ROI.
(Chris Ratcliffe/Bloomberg via Getty Images)More
The ongoing dialogue regarding the ever-imminent displacement of white-collar workers by AI is predicated on the assumption that the technology will become as skilled as the very workers it threatens to displace, thereby cutting labor costs. But a new study found that’s not quite what’s playing out in many companies that have carried out AI-related layoffs.
A survey of 350 global business executives with an annual revenue of at least $1 billion by the research and advisory firm
Gartner found that many have reduced their workforce irrespective of AI adoption. While 80% of those surveyed who have piloted an AI or autonomous technology have reported workforce reductions, the businesses cut jobs due to automation regardless of whether the technology was actually generating returns.
“Looking only at layoffs is shortsighted in terms of getting value from AI,” Helen Poitevin, VP analyst at Gartner and a key researcher of the study, told
Fortune. “Chasing value only through headcount reduction is likely to lead most organizations down a path of limited returns.”