A mechanical hand is displayed at Robot Mall, the world’s first embodied intelligent robot 4S store, in Beijing, China, August 13, 2025.
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Companies are quickly changing their minds that artificial intelligence can “do anything” by hiring new employees to drive their businesses forward, while investors are concerned about the longevity of the ongoing AI boom in financial markets.
Car manufacturer ford is one of the latest companies to reverse course. It is Hundreds of experienced human engineers were reportedly rehired to work on quality issues that automated systems couldn’t solve. “Artificial intelligence is a fantastic tool, but it is only as good as the information you train it with,” Charles Poon, vice president of vehicle hardware engineering at Ford, told the media.
Other companies that have scaled back their hiring plans to focus more on human capital include: Commonwealth Bank of Australia and software giant IBM.
Last year, CBA laid off more than 40 customer service representatives and replaced them with an AI voice bot. However, the AI system was unable to handle this, leading to a surge in calls and prompting CBA to reverse the job cuts. “Getting the CBA to reverse these job cuts is a huge victory,” the Australian Financial Sector Union said in a statement.
An ABC report in August last year said CBA admitted it had “not adequately considered all relevant business aspects” when announcing the redundancies and admitted that “we should have been more thorough in assessing the roles required”.
Similarly, IBM replaced its human resources functions with AI, which handled about 94% of routine requests but could not handle the other 6%, including ethical dilemmas. IBM then announced plans to triple its hiring of entry-level professionals across all U.S. businesses by 2026.
“If we don’t continue to invest in new hiring, what happens in three to five years?” said Nickle LaMoreaux, IBM’s chief human resources officer, at a Charter AI Summit in New York. “There’s no pipeline; the well just runs dry,” LaMoreaux added.
These examples reflect analysts’ view that laying off employees while leveraging more AI is not necessarily the best path to business growth.
“By budgeting for ‘technology to replace humans’ without investing in training or upskilling, teams were left unprepared to use AI,” says a report from Intuition Labs. “Particularly among companies pushing automation, many ‘regretted’ subsequent layoffs because they had lost the very people needed to oversee AI,” it continued.
According to a report by Orgvue, 39% of business leaders have fired employees due to the use of AI. However, 55% of these respondents admit that poor decisions were made regarding these layoffs.
“When AI results are inconsistent, inaccurate or difficult to apply, companies often need to reintroduce human oversight,” said Jessica Zhang, senior vice president APAC at HR solutions provider ADP. “This can lead to duplication of effort, slower decision-making and lower productivity gains,” Zhang added.
Meanwhile, 32% of hiring managers in the U.S. said they eliminated a job primarily because of AI and later rehired for the same or a similar position, according to data from Robert Half sent to CNBC.
“AI is transforming the workplace, but it is becoming clear that companies see more value in building collaboration between humans and AI rather than replacing human work entirely,” noted Capitol Technology University.
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https://www.cnbc.com/2026/07/01/employers-who-laid-off-workers-for-ai-are-reversing-their-decisions.html
