A new study reveals that more than half of British companies that cut jobs due to implementing artificial intelligence (AI) now regret their decision.
According to a survey by Orgvue, a workforce design platform, 39% of UK firms reduced staff citing AI adoption. However, 55% of these companies now believe this was a mistake, as TechRadar reported on Tuesday.
These businesses reported unexpected consequences, including internal turmoil, employee exodus, and decreased productivity, sharply contrasting with their initial expectations.
This trend suggests waning confidence among companies in AI’s ability to replace human workers completely. Orgvue’s report highlights that 38% of executives still struggle to grasp AI’s full impact on their businesses, while 25% remain uncertain about which roles AI might replace.
The expectation that AI will substitute some employees has dropped from 54% last year to 48% this year. Orgvue also noted a decline in leaders’ sense of responsibility for protecting their workforce.
Oliver Shaw, CEO of Orgvue, remarked that if 2024 was the year of AI investment and optimism, companies are now realizing the risks of replacing staff with AI. He cautioned that laying off employees without a clear workforce transition strategy is reckless.
In response, businesses are bolstering employee retraining programs and tightening AI usage policies to mitigate disruptions. About 80% of companies, concerned about indiscriminate AI use, are planning AI training initiatives. Moreover, 41% have already increased training budgets, 51% have implemented internal AI policies, and 43% are partnering with external AI experts.