AI Replacements Rehired at Lower Wages

Employers are increasingly reversing AI-driven layoffs, often rehiring staff at lower wages or moving roles offshore, according to new data from Forrester. The research firm reports that 55% of employers regret terminating employees in favor of artificial intelligence solutions. Furthermore, they anticipate that approximately half of these AI-related job cuts will be quietly undone, though the resulting employment arrangements rarely benefit the displaced workers financially.

This trend highlights a growing disconnect between corporate strategy and workforce stability. While companies backtrack on their reductions, the financial burden falls on employees rather than corporations. This anxiety is widespread; a Reuters Ipsos poll indicates that 53% of Americans fear AI will displace someone in their household. Similarly, a 2026 report by Software Finder reveals that 53% of workers feel their roles are becoming less essential due to AI integration.

Industry experts argue that leadership strategies are failing to address these human impacts. Gartner’s Jackie Swanson emphasizes this oversight: “Every organization has an AI adoption roadmap. Almost none of them have an honest plan for what AI is doing to their people, their pace and their pipeline of future leaders,” she wrote. In response, some organizations are adopting voluntary measures to mitigate disruption. These include internal training initiatives, maintaining long-term employment security, and allowing teams autonomy in selecting technology tools.

Kenny Mendes, Superhuman’s chief people officer, explains their decentralized approach: “We don’t start with a top-down AI mandate,” said Kenny Mendes, Superhuman’s chief people officer. He notes that letting teams close to specific problems choose their own tools prevents changes from being perceived merely as cost-cutting exercises.

Europe is taking a more regulatory approach to this issue. Unlike the voluntary methods seen in some US companies, European law mandates consultation with workers before implementing decisions that reshape their jobs. This legal framework is set to tighten under Directive 2025/2450, which revises rules for European Works Councils. Member states must transpose this directive by 1 January 2028, ensuring consultations occur in good time and allow for thorough assessment prior to decision-making.

Compliance will carry significant financial weight. The directive requires member states to impose effective and dissuasive financial sanctions, calculated partly based on company turnover. This regulatory push comes amid high-profile corporate shifts, such as Meta cutting 8,000 jobs while redirecting billions toward AI infrastructure. Consequently, the two continents are navigating distinct challenges: America is debating transparency regarding AI’s impact on employment, while Europe is focusing on the timing, format, and financial consequences of failing to consult properly.