The artificial intelligence revolution may not be eliminating human jobs as quickly as some feared. Rising computing costs, operational headaches, and inconsistent results are prompting some companies to change course and bring workers back.
It’s a hard lesson learned in the throes of the early AI boom, in which bold claims of big savings have enticed many businesses to downsize their staff.
Many industry professionals now say that roles requiring sound judgment, creativity, customer interaction, and quality control need to keep humans in the driver’s seat.
A Careerminds survey of 600 human resources professionals who’d made layoffs in the previous 12 months revealed that nine out of 10 companies would rethink their AI-related terminations.
Three out of four human resources professionals who took the survey confirmed that their organization sacked employees because of technological advancements that replaced roles and responsibilities.
But only 8.4 percent of the survey pool said AI delivered the promised results.
“Over the past 12 months, we have seen a noticeable uptick in companies coming to us after pausing or scaling back AI tool rollouts,” James Calloway, chief operating officer at Stealth Agents, told The Epoch Times.
Calloway’s company provides executive-level virtual assistants, an area where the cost difference between human workers and AI agents is stark.
“One e-commerce client had budgeted for an AI customer service implementation and found the licensing, integration, and ongoing prompt engineering costs were two to three times their original estimate,” he said.
“They hired two of our [human virtual assistants] instead and cut their per-ticket resolution cost by nearly 40 [percent].
“Human employees remain more cost-effective in client-facing communications that require empathy and judgment, tasks that require reading between the lines of what a customer actually needs, work involving proprietary context that cannot safely be fed into third-party AI systems, and any workflow where a mistake has real reputational or legal consequences.”
Big tech companies have also found this to be true. In April, Bryan Catanzaro, vice president of applied deep learning research at Nvidia, told Axios, “For my team, the cost of compute is far beyond the costs of the employees.”
Nickle LaMoreaux, senior vice president and chief human resources officer at IBM, argued that augmenting roles with AI is more essential to corporate growth than replacing human talent entirely, during a Wall Street Journal Leadership Institute summit in March.
LaMoreaux’s comments followed just weeks after IBM announced plans to triple its entry-level hires. When asked why so many companies aren’t taking a similar approach, he said, “It’s because they’re in this productivity mindset versus the growth mindset.”
A BCG analysis predicted that 50 percent to 55 percent of all jobs in the United States will be “reshaped” by AI within the next couple of years.
Jon Hill, CEO of The Energists, said there’s a misconception that generative AI is just “software with a subscription fee.” He has personally witnessed how AI buyer’s remorse can lead to staff rehires.
“Many of our clients aggressively pursued generative AI initiatives, thinking they would reduce labor costs,” Hill told The Epoch Times, “but we’re increasingly seeing those clients circling back to human employees after discovering the real-world costs of AI systems.”
Hill gave the example of one company that he worked with that planned to automate some of its compliance reporting and technical support. The company found that while the projected savings initially looked promising, those gains evaporated when taking into account the costs of cybersecurity, human oversight, and application programming interface usage.
The client chose to pause AI deployment because “human staff provided more predictable output at a lower long-term cost,” he said.
Hill said there are multiple costs that organizations can overlook. Cloud compute costs alone can be “a six- to seven-figure annual expense,” depending on usage, Hill said.
Matt Baharav, CEO of MKB Media Solutions, told The Epoch Times that the AI content assistant his team implemented ended up being both costly and inefficient.
“Last quarter, we decided to stop utilizing an [AI] automated content assistant for our outreach pitches. We realized the software was ineffective,” Baharav told The Epoch Times.
“The company we hired and paid thousands per month charged us licensing costs, as well as had my team spend countless hours rewriting generic paragraphs created by their tool.”
Baharav said he learned that “a good writer is less expensive than an expensive automated content assistant” when it comes to complex communications.
“We eliminated the software altogether and transferred the funds back into hiring competent, sharp writers,” he said.
Tech spending tracker Mavvrik, in its 2025 State of AI Cost Management report, observed that 80 percent to 85 percent of companies missed their AI infrastructure forecasts by more than 25 percent, while 84 percent reported “significant gross margin erosion” because of miscalculated AI costs.
—Autumn Spredemann
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