Feature
As generative artificial intelligence (AI) reshapes the global workplace, companies such as Cisco, UPS, Duolingo and Klarna are incorporating automation while simultaneously cutting jobs, despite earlier assurances that AI would not lead to layoffs. UPS has announced plans to eliminate 20,000 positions in 2025, while Cisco is reducing its workforce by nearly 6,000 as AI becomes further embedded in operations.
AI Promises Efficiency – and Disruption
This shift underscores a growing contradiction: while AI promises efficiency, innovation and growth, it is also contributing to workforce disruption, job insecurity and a widening skills gap.
In fact, 54% of tech hiring managers expect layoffs within the next year, and nearly half say roles that can be replaced by AI are most at risk, according to a recent study by General Assembly. “We’re on the precipice of an unprecedented skills crisis,” warned Daniele Grassi, CEO of General Assembly. The study also found that while 69% of tech leaders anticipate AI will create new roles, 76% agree that employees vulnerable to automation could be retrained — if companies act quickly and deliberately.
Yet the transition comes at a psychological and cultural cost. Ivanti’s 2025 Technology at Work Report reveals rising anxiety among employees facing an uncertain future. Thirty percent of workers who use generative AI tools fear their jobs are at risk, while 27% report experiencing AI-driven imposter syndrome, worried that their capabilities might be devalued.
"Employers who fail to approach innovation with empathy and provide employees with autonomy run the risk of losing valuable staff and negatively impacting productivity,” said Brooke Johnson, Ivanti’s chief legal counsel and senior vice president of human resources and security.
Despite a sharp increase in generative AI use — 42% of employees now use it at work, up from 26% the year before — many keep this usage private. Some see it as a secret advantage; others worry it might make them appear replaceable. This silent adoption, combined with workplace trends like “resenteeism” (remaining in a job despite dissatisfaction) and “presenteeism” (being physically present but unproductive), signals a workforce struggling to adapt.
Why AI Mandates From CEOs Don’t Work
As companies ramp up AI investments, the challenge is no longer whether to use the technology, but how to implement it responsibly and effectively. But top-down mandates to “use AI or fall behind” risk creating disorganized adoption rather than meaningful transformation, Grassi warned.
“Today, we’ve seen several CEOs mandating that employees use AI or find ways to use AI. What we don’t see is much guidance on how to do this,” Grassi said. “So, you have a disjointed approach to using AI where you’re losing out on potential productivity gains or cost efficiencies, or worse, you’re adopting AI in ways that don’t necessarily make sense, just for the sake of using AI.”
Without structured training and intentional integration, AI becomes a blunt instrument, displacing roles rather than evolving them. Effective adoption requires more than mandates, Grassi emphasized. It demands sustained, relevant training aligned with business priorities, especially for executives, many of whom still haven’t learned to use AI tools themselves. True capability building comes from continuous learning and active engagement, not one-off workshops or generic encouragement.
“Consider that a year ago, we were mainly using AI in a chat interface,” Grassi said. “Now employees can tap AI agents to complete tasks autonomously behind the scenes. In a year, things will be different.” Without ongoing AI upskilling, workers risk falling behind a technology evolving faster than traditional training can keep pace.
The ripple effects of AI adoption are also being felt in the freelance and gig economy. Developers and consultants taking advantage of AI can now complete complex projects in a fraction of the time, challenging hourly billing structures and shifting client expectations. Rather than resisting these changes, companies need to rethink how they define value and compensate skills in an AI-powered market.
Relying on AI as a shortcut to reduce headcount is a flawed strategy, Grassi warned. Instead, businesses must view AI as a tool to enhance human potential, not replace it. The real danger is not the technology itself, but the failure to prepare people for the roles of the future. “Companies must invest in bringing their employees along, and build a culture where AI is used with purpose, not pressure,” he said.
A Roadmap for AI Integration
Executive Chairman of agentic AI developer Decidr, David Brudenell, offered a practical roadmap to integrate AI without sacrificing human value. Companies should stop treating AI as a one-to-one replacement for workers and instead focus on redesigning roles around human strengths such as judgment, creativity and interpersonal relationships, he said. “If AI makes work faster, make your people more valuable by moving them to work that still needs a human touch,” he said.
Reskilling must happen in real time, through live projects and active learning, not theoretical courses or optional training catalogs, Brudenell said. “Show workers the future roles you’re building,” he advised. “And pay them to prepare, rather than asking them to guess what skills might matter.”
AI also changes workplace dynamics, removing inefficiencies but risking the erosion of human connection. Leaders must deliberately preserve culture by keeping people engaged in decisions that matter. “Culture suffers when people stop feeling useful,” Brudenell warned. “Good leaders design for both speed and connection.”
Transparency is essential. Employees need to understand what AI tools are doing, how AI affects decisions and where accountability lies. Hidden algorithms create mistrust. Clear communication about risks, data usage and limitations is crucial to building confidence and trust.
Ethical AI governance also matters. Companies should publicly define boundaries on issues like surveillance and bias and be willing to admit when AI fails, fixing it quickly and openly. Fairness must be measured and enforced, just like financial or operational metrics, Brudenell said. Displaced employees should receive retraining and real pathways back into the organization.
Beyond tools, infrastructure plays a critical role. Companies need decision scientists and translators — people who can align business needs with AI capabilities. That requires secure systems that prioritize both speed and thoughtful oversight.
As AI supports more freelance and contract-based work, traditional employment models will shift. Companies must be ready to provide more fluid team structures with fair compensation, protections and long-term partnerships. Success will favor organizations that remain adaptable without losing their human core.
Poor AI Strategy Leads to Unnecessary Cuts
Workforce disruption doesn’t have to be a casualty of AI, said Andrea Schnepf, founder and managing Director of Nepf, a boutique firm focused on leading change. Instead, poor alignment between cost-cutting and strategy often leads to unnecessary job losses. “Many restructuring efforts focus solely on short-term cost reduction, leading to unintended consequences such as skill gaps, loss of institutional knowledge and weakened innovation capabilities,” she said.
Companies should approach layoffs and restructuring strategically, anchoring decisions in long-term goals, Schnepf said. That means aligning leadership on vision, safeguarding core initiatives and reallocating talent to preserve critical capabilities. “This isn’t just about financial efficiency,” she said. “It’s about building lasting resilience.”
The Human Impact of GenAI
AI’s impact is not just technical — it’s deeply human. Behavioral resistance is the hardest barrier to overcome, Schnepf said. “People are being asked to abandon familiar routines and trust something they don’t fully understand,” she explained. Leaders must build trust by demonstrating AI’s role in real tasks, like helping a financial analyst shift from Excel models to AI-generated insights.
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Integrating AI successfully also means assessing the organization’s readiness: identifying skill gaps, understanding resistance and creating clear incentives. Leaders must articulate not only how AI benefits the business, but how it can elevate individual careers. While some roles will be displaced, others will become more essential, and those who embrace AI may find themselves thriving in new, dynamic positions.
Ultimately, companies that navigate this transformation most effectively will be those that see AI not as a replacement, but as a catalyst. By aligning people, structures and strategy, they build workplaces that are not just more productive, but more human.
Editor's Note: Read more about the human implications of AI in the workplace:
- AI Is Your Leadership Test: Will You Build a Future-Ready Culture or Get Left Behind? — AI is transforming the way business gets done, with or without you. Will your people be part of this revolution or sidelined by it?
- The Human Skills We Need for the Generative AI Era — The fear that AI is coming for jobs is real. But is it justified? Two experts share their predictions and what they see as the human skills of the future.
- People-Centric Leadership and AI: Can We Have Both? — AI can support people-first leadership, if we use it with care.