As we approach the end of 2025, many organizations are taking stock of their financial performance, technology investments, and workforce strategies. What stands out most is the sheer scale, and repetition, of layoffs across corporate America. According to recruitment firm Challenger, Gray and Christmas, over 1.1 million job cuts have been announced through the end of November. Not only is that number up 54% over the same period last year, it is only the sixth time since 1993 we have seen layoffs top 1.1 million.
The remarkable part is that these same employers will frequently rehire the same people after changing tack yet again. This raises an uncomfortable but necessary question: why the constant short-sighted cycle of firing and rehiring?
Layoffs Are Rising - But the Rationale Is Shifting
Unlike in previous years, employers in 2025 have been quick to point the finger at artificial intelligence (AI) as justification for workforce reductions. The expectation is familiar: automation and augmentation will unlock productivity gains, allowing organizations to “do more with less.”
The AI Productivity Assumption
Yet at the Gartner HR Symposium I attended earlier this year, research suggested that only one in five AI implementations achieves measurable ROI. Put simply, while AI holds enormous promise, it has not yet broadly delivered the kind of transformative efficiency that would make mass layoffs a rational alternative to reinvestment in human capital.
Why AI-Driven Layoffs Miss the Mark
The rush to frame AI adoption as a justification for layoffs oversimplifies the reality of deploying complex technology. More importantly, it diverts attention from the harder—and more valuable—work of redesigning jobs, reskilling staff, and aligning talent with long-term strategy.
Layoffs as a Symptom, Not a Strategy
Too often, workforce reductions are reactive measures that mask deeper organizational issues:
- Inadequate strategic planning
- Lack of clarity in enterprise priorities
- Chronic underinvestment in workforce development
In practice, layoffs become a blunt instrument—one that trades long-term capability for short-term cost relief.
The Cost of Ignoring Future Readiness
Another fundamental weakness of this approach is its failure to anticipate:
- Emerging opportunities
- Macro-economic shifts
- The ability to proactively redeploy talent based on transferable skills
Organizations that repeatedly cut and rehire are not becoming leaner—they are becoming less resilient.
Three Strategies to Consider Before Resorting to Layoffs
As new technologies such as agentic AI and generative AI continue to mature, organizations should pause before defaulting to workforce reductions. Instead, leaders should consider three foundational strategies.
1. Plan Ahead
Clearly define corporate strategy, identify critical workforce skill gaps, and evaluate both current and future external forces—including technological disruption. Strategic foresight reduces the need for reactive decisions.
2. Repurpose People
Invest in upskilling, reskilling, and redeployment rather than releasing employees who possess valuable institutional knowledge and intellectual capital. Talent adjacency often matters more than exact role fit.
3. Leverage Technology Thoughtfully
Adopt Strategic Workforce Planning (SWP) technologies that integrate operational, financial, and human capital data. These tools enable leaders to make better decisions for and about their people—before workforce issues become crises.
The End of Organizational Silos
One additional consideration cannot be ignored. Many organizations have historically operated with HR, Finance, and IT functioning independently. Those days are over.
From Workforce to Work
Another key theme from the Gartner event was HR’s evolution—from focusing on the workforce to focusing on the work itself. As IT selects AI-driven tools that perform portions of this work, and Finance approves and budgets for these investments, cross-functional collaboration becomes essential.
This alignment is even more critical when viewed alongside looming workforce shortages driven by declining birth rates and demographic change.
Planning for a Future Where AI Amplifies Talent
Layoffs may feel expedient in the short term, but they are a poor substitute for thoughtful organizational design. Rather than wielding the axe and treating people as disposable line items, organizations would be better served by sharpening their workforce planning tools.
If we want a future where technology amplifies human capability rather than prematurely replacing it, the work must begin now.
Turning Insight Into Action
At LYTIQS, we work with organizations to move beyond reactive workforce decisions—helping leaders connect strategy, skills, and technology through data-driven Strategic Workforce Planning. By integrating operational, financial, and human capital insights, organizations can prepare for AI-driven change without sacrificing long-term capability.If your organization is navigating AI adoption, workforce uncertainty, or recurring cycles of layoffs and rehiring, the question is not whether change is coming—but whether your planning approach is ready for it.