AI-driven layoffs aren’t making business sense

A huge majority of large enterprises have laid off employees after rolling out AI initiatives, but reducing headcount doesn’t lead to the ROI executives may expect. Eighty percent of large enterprises surveyed by Gartner have reported workforce reductions after launching automation projects, with the average reduction between 1% and 15%. The IT analyst firm, however, has found no correlation between layoffs and AI ROI. Enterprises reporting significant ROI from automation initiatives have laid off workers at a similar pace as enterprises reporting modest ROI gains, or negative ROI, from automation initiatives, indicating that layoffs and returns aren’t connected, says Helen Poitevin , digital workplace analyst at Gartner. Laying off employees may lead to short-term profit gains, but the late 2025 survey of business executives at large enterprises goes against a common perception that workforce reductions driven by AI-enabled productivity leads to ROI, she notes. “You would anticipate t