6 In 10 Businesses Plan 2026 Layoffs, Fueled By AI And Economic Fears

There is a growing unease among U.S. employers as 2025 draws to a close. In fact, nearly half of business leaders say they’ve already slowed or frozen hiring, and more than a third plan to cut staff before year-end. 

Looking to 2026, even more anticipate layoffs — and a significant number say they will replace employees with AI instead of refilling roles.

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This data, based on a September survey of 1,000 business leaders by Resume.org, shows just how economic uncertainty, policy concerns, and automation are reshaping hiring strategies.

Hiring Pullbacks Are Widespread

Almost 1 in 2 companies have scaled back hiring, with 9% instituting a full hiring freeze and 41% reducing recruitment efforts. Just 9% report increasing hiring.

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The top reasons behind this slowdown include:

• Economic uncertainty (63%)
  
• Tariffs and trade policy (38%)
  
• Falling revenue (35%)
  
• AI investments reducing the need for staff (22%)
  

Layoffs Are Already Hitting, and More Are Coming

So far in 2025, 39% of companies have laid off workers, and 35% expect to cut more staff before the year ends. Looking ahead, nearly 6 in 10 employers say layoffs in 2026 are likely, driven primarily by:

• Trade policy and tariffs (48%)
  
• Ongoing economic concerns (47%)
  
• AI adoption (35%)

The most vulnerable employees? Those with high salaries (48%), limited AI skills (46%), recent hires (42%), and entry-level roles (41%). Companies also flagged younger and older workers, along with H1B visa holders, as at higher risk of being cut.

AI Is Replacing Jobs, And It’s Accelerating

Nearly 30% of companies say they’ve already used AI to replace roles in 2025. That number is expected to rise sharply, with 37% planning to replace workers with AI by the end of 2026.

In fact, 68% of companies increased AI investment this year, which is a clear sign that workforce automation is becoming a core strategy.

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Roles involving repetitive tasks, process management, and administrative work are among the first to be automated. However, new categories of work are emerging around AI oversight, compliance, and human-AI collaboration — putting pressure on workers to adapt quickly.

Companies are prioritizing cost-efficiency and AI-readiness over traditional job experience, leaving many professionals vulnerable unless they reskill. The most sought-after employees will be those who combine digital fluency with critical thinking and emotional intelligence — qualities that machines still can’t replicate.

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