Report says many firms regret replacing workers with AI and robots

ISTANBUL

Some businesses that laid off workers to rely more on artificial intelligence (AI) and robotics reportedly regret the move, as automation has failed to deliver expected results in many sectors, according to a new report.

AI adoption has expanded across education, commerce and multiple industries, with firms announcing layoffs to shift toward technology-driven operations. The decisions have sparked criticism, especially when AI systems make critical mistakes.

While robots and AI have taken over repetitive tasks, they have not matched human ability in more complex or creative work.

The integration of these systems is falling short of expectations, with 55% of surveyed companies saying they regret replacing staff with AI, according to a recent article by the UK-based design platform Orgvue.

Duolingo, the popular language-learning app, is among companies facing challenges after cutting contract workers involved in translation and content moderation.

Users say prioritizing AI has weakened some of the app’s playful and engaging features.

Another high-profile example came when billionaire Elon Musk pushed heavy automation at Tesla in 2018.

During early production of the Model 3 sedan at the Fremont plant in California, the company halted hiring and leaned on robots and automated transport systems.

Tesla expected more efficient production while halting hiring, but the inability of robots to be flexible in production, especially in complicated and unexpected situations in an assembly line, made it so that the company did not even get close to its 5,000-unit production target with a sub-2,500-unit production, reportedly due to excessive automation.

“Yes, excessive automation at Tesla was a mistake. To be precise, my mistake. Humans are underrated,” Musk said in a post on X that year.

Another area Al has underdelivered and has yet to be successful is news reporting. Microsoft laid off some 50 editors and journalists from its news aggregates MSN and Microsoft News to replace them with Al in 2020.

Completely fabricated stories circulated on MSN following this decision, a report by CNN showed. False reports of deaths and resignations caused a stir, while Al came under fire for errors on sensitive public-interest issues.

Tech companies may now be reconsidering the pace of replacement. Layoffs in the sector have fallen as firms adjust their strategy, according to the layoff tracker Layoffs.fyi.

Tech companies cut about 40,000 workers in the third quarter of last year, compared with around 26,000 during the same period this year, a 35% decline, the data showed.