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AI isn’t paying off in the way companies think. Layoffs driven by automation are failing to generate returns, study find

Topic: technologyRegion: north americaUpdated: i2 outletsSources: 2Spectrum: Center OnlyFiltered: Asia (1/2)· Clear⏱ 2 min read
📰 Scored from 2 outletsacross 2 Center How we score bias →
Story Summary
SITUATION
A Gartner study found that layoffs driven by automation are not generating the returns companies anticipated. Despite 80% of surveyed companies reporting workforce reductions, there is no correlation between these layoffs and higher ROI (per Fortune).
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Spectrum: Center Only🌍Asia: 1 · Other: 1
Political Spectrum
Position is inferred from coverage mix.
i2 outlets · Center
Left
Center
Right
Left: 0
Center: 2
Right: 0
Geography Coverage
Distribution of where coverage is coming from.
i2 unique outlets · Dominant: Asia
KEY FACTS
  • A Gartner study found that while 80% of companies surveyed reported workforce reductions, there was no correlation to higher ROI.
  • Poitevin said the companies reporting high ROI were not the same ones reporting AI-related workforce reductions.
HISTORICAL CONTEXT

This development falls within the broader context of Technology activity in North America. Current reporting indicates: AI isn’t paying off in the way companies think.

Layoffs driven by automation are failing to generate returns, study finds Layoffs driven by automation are failing to generate returns, study finds AI-driven layoffs aren’t generating the returns companies expected, study finds. A Gartner study found that while 80% of companies surveyed reported workforce reductions, there was no correlation to higher ROI.

Brief

A recent study by Gartner has revealed that layoffs driven by automation are failing to yield the expected financial returns for companies. Despite 80% of surveyed businesses reporting workforce reductions, the study found no correlation between these layoffs and an increase in return on investment (ROI).

This raises significant questions about the effectiveness of automation strategies that many companies have adopted in hopes of enhancing efficiency and profitability. The survey, which included 350 global executives from firms with annual revenues exceeding $1 billion, indicated that many companies have cut jobs irrespective of their AI adoption status.

Notably, the companies that reported high ROI were not the same as those implementing AI-related workforce reductions, suggesting a disconnect between automation efforts and financial performance.

Furthermore, the rates of workforce reductions were nearly identical for companies experiencing both high and low returns, indicating that the anticipated benefits of automation may not be materializing as expected. Executives have voiced concerns that the financial advantages of automation are not being realized, prompting a reevaluation of their strategies moving forward.

As businesses navigate this complex landscape, the implications of these findings could reshape how companies approach automation and workforce management in the future.

Sources
1 of 2 linked articles · Filter: Asia