AI-driven layoffs dominated the headlines this year.
Employers cited AI as the primary reason for almost 40% of the job cuts announced in May 2026, according to a report from outplacement firm Challenger, Gray & Christmas.
But new research shows that some employers may be rethinking those job cuts and reversing course in a trend experts call “AI rebounding.”
In a survey of more than 1,000 U.S. workers, nearly 1 in 5 respondents say that they have been laid off or replaced by AI and then asked to return, according to a recent report from SHL, a talent acquisition and talent management company. The survey, which SHL commissioned from market research firm Propeller Insights, also polled over 1,000 U.K. workers. It was conducted between June and July 2026 and had a margin of error of 5%.
These findings indicate that companies are realizing they “pulled the plug too quickly” on their human employees, according to Lucy Beaumont, global senior vice president of product and design at SHL.
Several large employers like Ford and Amazon have reversed course after enacting AI-related layoffs in the past year. A March report by Orgvue found that 32% of organizations that let workers go due to AI have had to rehire staff.
It’s a mistake for companies to approach AI implementation as if it were any other software rollout, says Joseph Fuller, professor of management practice at Harvard Business School.
From a company’s perspective, “in order to spend money on a new technology, we have to find some savings in the budget, and the way we’ve done that with previous technology deployments is by laying people off.”
But AI is most useful when it’s linked with a human worker’s “contextual intelligence,” i.e. their background knowledge and understanding of an issue, he says: “The more you know about important processes, the more value you can extract from the AI.”
AI can’t fully replace “people that know the business, that know their customers, that have judgment, that can bring empathy, that have that human connection,” Beaumont says.
Returning workers have new demands
Most workers are open to returning after a layoff: only 6.6% of U.S. workers say they would refuse to come back under any circumstances, according to the SHL study.
According to SHL’s research, almost half of surveyed U.S. workers would require a significant pay increase to return to their roles, and 43% would want “written guarantees” of job security. A similar number, 40%, would require “full transparency” regarding how AI would be used in their role before they’d rejoin the company. And 30% of workers say that an apology or acknowledgment from leadership is a key condition of their return.
Above all, employees are looking for reassurance, Beaumont says: “How do I know that this isn’t going to happen again?”
Even when workers do return, employers need to understand that company morale is going to take a hit, according to Beaumont. Being laid off “fundamentally changes” the psychological contract between employer and employee, she says, and being rehired isn’t enough to repair that relationship.
“You’ve really broken the trust with those people,” Beaumont says.
As a result, returning workers are unlikely to have the same levels of “productivity and engagement” as they did before a layoff, she says. “Culture is so difficult to change, and once you’ve impacted it negatively, it’s so difficult to recover from.”
What skills workers should practice
Given how quickly AI’s capabilities will grow, the most important skill for employees to hone is adaptability, Fuller says. He urges workers to practice working with AI regularly and “seek out opportunities” to upskill with the technology.
Workers will also need to get comfortable with change, he says. In the near future, Fuller predicts that AI will create “permanent tumult” within many organizations as they continue to recalibrate their staffing needs around AI advancements.
Beaumont recommends that workers identify the areas where their unique skills can have the most impact: “If AI is going to take away some of those easily automated tasks, what’s left for me to do, and how can I optimize the human side that I can bring?”
Leaders should focus on questions like, “What kind of upskilling do people need? What new opportunities are there for people? What kind of internal mobility am I opening up as a result of AI?” she says.
The organizations that will be successful are the ones who “are using AI to optimize what they do,” Beaumont says — not just to cut costs.
