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Study finds 5.3% of laid-off employees are being rehired by their former companies.
Despite fears of mass layoffs due to automation, artificial intelligence is still far from fully replacing human labor. According to new data from TechSpot, more companies are now rehiring workers they had previously let go.
A global study by Visier, which analyzed data from over 2.4 million employees across 142 companies, found that 5.3% of laid-off workers returned to their former employers. That rate had remained stable since 2018 but has recently risen. Visier’s director Andrea Derler noted that many layoffs have been justified by the adoption of AI — yet the technology has not proven capable of replacing humans entirely.
“The idea that artificial intelligence will come in and replace every single job hasn’t been proven,” Derler said, adding that AI often serves as “a convenient explanation for layoffs.”
Analysts at Visier emphasized that rehires often signal poor workforce planning. Executives tend to overestimate AI’s potential and underestimate the true costs of implementation — from infrastructure and technical maintenance to training.
Many leaders, Derler added, “simply didn’t have time to assess which functions can actually be automated and which remain inherently human.” As a result, companies spend heavily on AI tools, only to realize later that they lack the people needed to operate them effectively.
The findings align with a Massachusetts Institute of Technology (MIT) study showing that 95% of organizations fail to achieve measurable financial returns from their AI investments. According to Interactive Brokers’ chief strategist Steve Sosnick, “it’s possible all that money isn’t being spent particularly wisely.”
Layoffs themselves also turn out to be costly. Research from Orgvue shows that for every dollar saved through job cuts, companies spend an average of $1.27 on severance, insurance, and related expenses.
Derler concluded that the current situation highlights “a significant gap in strategic planning.” Mass layoffs may appease investors in the short term, but in the long run, businesses often end up rehiring the same workers they once deemed unnecessary.
