The Impact of AI on the Workforce: Trends and Predictions for 2026

Concerns about the influence of artificial intelligence on employment continue to accelerate as technological advancements and new automation products emerge. Evidence suggests that these worries are not unfounded.

A November study by MIT estimates that approximately 11.7% of jobs could already be automated using AI technology. Surveys indicate that companies are increasingly eliminating entry-level positions due to AI integration, and some layoffs are directly attributed to AI implementation.

As organizations adopt AI more strategically, they might reevaluate their staffing needs. A recent TechCrunch survey revealed that multiple enterprise venture capitalists foresee AI significantly impacting the workforce by 2026. Remarkably, this expectation was not explicitly part of the survey questions, highlighting a strong industry consensus about upcoming changes.

Eric Bahn, co-founder and general partner at Hustle Fund, anticipates effects on labor markets in 2026 but remains uncertain about their exact nature. “I want to see which roles—whether repetitive or more complex with significant logic—get automated. Will this lead to more layoffs? Will productivity increase? Or will AI serve primarily as an augmentation for existing jobs? These questions are still open, but it’s clear something big is on the horizon for 2026,” Bahn explained.

Predictions for 2026 and Industry Insights

At the TechCrunch event in San Francisco scheduled for October 13-15, 2026, Marell Evans of Exceptional Capital predicted that companies expanding AI budgets will divert funds from hiring and labor initiatives. “On the flip side, increased AI investments will likely result in further layoffs and a continuing decline in U.S. employment,” Evans stated.

Rajeev Dham from Sapphire concurred, emphasizing that resource allocation in 2026 is expected to shift from human labor to AI systems. Jason Mendel from Battery Ventures added that AI will evolve beyond a mere productivity tool, beginning to automate complete workflows and displacing workers in certain sectors.

Antonia Dean, partner at Black Operator Ventures, noted that even if companies do not reallocate budgets toward AI directly, they will nonetheless attribute layoffs or cost reductions to AI, often as a convenient scapegoat to cover past strategic missteps. "Many enterprises will claim increased AI investment as a justification for workforce cuts, even if actual expenditures haven't shifted significantly," Dean explained.

Debates Over Job Security and AI’s Role

Proponents of AI technology argue that automation primarily shifts workers to more meaningful, high-skilled tasks, reducing mundane “busy work” rather than eliminating jobs entirely. However, skepticism persists among the workforce, and venture capitalists investing in AI are not optimistic about easing these fears by 2026.

Becca, a senior writer at TechCrunch specializing in venture capital and startups, notes that while AI firms claim their technology enhances productivity, many industry insiders worry about widespread job automation.

You can follow Becca’s work or contact her at rebecca.szkutak@techcrunch.com for further insights into AI's evolving role in the labor market.