AI’s workforce impact has only just begun

High-profile companies such as Block have laid off thousands of employees in recent months, with many saying AI has taken over worker tasks.

While AI’s long-term impact on jobs and the job market remains uncertain, IT analyst firm Gartner expects more job chaos in the coming years due to AI, predicting that 32 million jobs will be significantly transformed by AI each year in the near term. Ultimately the firm projects that AI will create more jobs than it replaces starting in 2028 or 2029.

Many IT jobs will be among those transformed by AI, says Nate Suda, an analyst on Gartner’s AI strategy team. The jobs most at risk are those focused on workflows, including service desk roles, business analysts, and project managers, he adds.

“The IT jobs that are going to be affected first are workflow heavy, anywhere the output is tickets, documentation, status templates,” he says. “Our guidance here is that these routine tasks will be increasingly automated and that’s going to compress headcount and shift the balance of human workers to knowledge curation, exception handling, workflow design, and especially, cross-functional work.”

While some IT jobs may be cut, and layoffs like the ones at Block have grabbed recent headlines, Gartner doesn’t see a huge trend toward companies replacing workers with AI because of automation efficiencies. Gartner tracked 1.4 million layoffs in 2025 and found that less than 1% of them were due to AI productivity gains, Suda says.

“The present state is that AI is changing jobs faster than it’s cutting them,” he adds. “The near-term story is not mass layoffs; it’s job redesign, hiring avoidance, and role consolidation.”

Less hiring for now

A trend toward hiring avoidance is also observed in a recent Resume.org survey of nearly 1,000 US business leaders. About 21% of companies have stopped hiring entry-level employees due to AI, and half will stop hiring entry-level workers by 2027. One in three companies expect entry-level roles to be eliminated at their organizations by the end of 2026. 

While Gartner isn’t seeing layoffs related to AI-based productivity gains, some recent layoffs are related in other ways to AI. In some cases, recent job losses attributed to AI are more related to companies refocusing their strategies around AI than due to productivity gains, Suda adds. One recent example is Oracle, which is reportedly planning to lay off thousands of workers to pay for AI-related data center expansions.

“Big tech companies, in particular, are repositioning their talent,” he says. “They are reducing roles from legacy business units so that they can pivot their focus into net-new market opportunities associated with AI.”

Suda has a warning for companies that aren’t big tech vendors, however. Leaders in other industries should realize that AI-driven efficiencies aren’t yet enabling most organizations to replace workers.

“This is not a strategy that should be adopted by companies that are not in big tech,” he says. “Unless I’m going into selling AI hardware, software, services, or consulting, if I’m a trucking company, this is not an appropriate signal for what AI should be doing to my workforce.”

Replacing employees with AI is also facing a backlash, according to a recent survey from IT training provider Udacity. Most executives, managers, and front-line employees prefer to work with other humans, with only 9% saying they would like to replace their entire workforce with AI tools.

Job transformation

While some IT jobs are at risk, many others will be significantly changed by AI in the coming years, Suda predicts. Many senior IT professionals will see the scope of their jobs expand and become more cross-functional as AI takes over more mundane tasks, he adds.

For example, AI will enable senior software engineers to take on work in adjacent roles such as business analysis or product management, Suda says.

“They are able to do work that they couldn’t do before, not because they didn’t have the time, but because they genuinely couldn’t do it,” he adds. “Because these workers have a high level of experience in their core competency, they can extend their core competency with AI into other areas. When we talk about role collapse, this is one of the big things that we’re talking about.”

Meanwhile, junior IT workers should embrace AI to help them level up their skills more quickly than they could without it, he adds.

Gartner projects four AI work scenarios likely to play out in the coming years. In the first scenario, companies will run with fewer workers, with humans filling in where AI can’t. Another possibility is that organizations will continue to run with many human workers, who use AI to do more and higher quality work.

In scenario three, many innovative workers collaborate with AI to surpass the frontiers of knowledge, leading to a major transformation of work. In the last scenario, some organizations would run with few to no workers, with AI doing most of the work.

Many organizations will use all four models, depending on the needs of individual business units, Suda says.

The takeaway for CIOs is that they need to work closely with their HR departments, he adds. “The success or failure of many AI strategies will hinge on that relationship and collaboration with the HR officer,” he says.

CIOs will also need to realize that AI may affect different IT roles in very different ways, Suda says. “The workforce plan that the CIO needs to put together for their own function needs to be differentiated,” he says. “The service desk is going to have a very different shape over the longer term than coding, and that’s going to have a very different shape than project management and product roles.”

Some IT jobs at risk

Gartner’s projections resonated with several IT leaders. Many junior-level IT jobs, including junior engineers, entry-level QA testers, and network administrators, will be affected by AI in the near term, says Adam Wachtel, CTO at HR platform provider Click Boarding.

“I don’t think these jobs will be eliminated, but they will be consolidated,” he says. “AI agents will be utilized to reduce headcount, but will, for the foreseeable future, still require human intervention and monitoring. Teams will be able to do more with less by leveraging agentic frameworks to automate routine tasks, facilitate knowledge transfer and assist with off-hours support.”

IT leaders will need to pay close attention to the ways AI will impact IT jobs, he adds.

“Keeping up with trends and where the innovations are happening is critical to stay up to speed and prepare leadership, peers, and reports for what the future holds,” Wachtel says. “Setting expectations in terms of AI use will be increasingly important as team members leverage these tools, either through work or independently.”

AI is driving a wave of change at organizations, adds Chris Willis, chief design officer and futurist at data platform vendor Domo.

“Big organizations have been designed to keep people in their lanes,” he says. “AI doesn’t care about your lanes.”

AI will take over routine and tedious tasks such as data preparation, dashboard maintenance, and ticket-based support, Willis predicts. AI and chatbots are making it easier to handle basic troubleshooting, data extraction scripting, repetitive analytics support, QA, and infrastructure monitoring, he adds.

“But AI isn’t replacing IT,” he says. “AI is removing friction from it. We are now seeing role-shifting happen where IT leans into higher-value and more strategic responsibilities with judgement like governing AI systems, defining business logic, ensuring data quality, and managing model risk.”

IT leaders should see part of their roles as reducing chaos while increasing organizational intelligence, Willis says. CIOs should invest in AI literacy within their teams, consolidate fragmented AI tools into smaller governed platforms, and define clear human-in-the-loop boundaries for critical processes, he advises.

“History suggests the right response to a major technical disruption isn’t ‘cut headcount’; it’s ‘redesign capability,’” Willis says. “For the foreseeable future, we’ll likely need more people to build, govern, and guide these systems even as certain tasks are automated.”