Key Findings

  • A recent survey by ResumeBuilder.com shows that more than half of U.S. companies are cutting or planning to cut employee compensation to free up funds forAI investments。
  • The survey results show that by the end of this year, 54% of companies will cut employee compensation, and 26% will reduce staff through layoffs to fund AI projects. Compensation cuts are not limited to base salaries but also affect bonuses, equity or stock awards, raises, and benefits. The survey interviewed 866 U.S. business leaders.
  • Stacie Haller, chief career advisor at ResumeBuilder.com, said in a press release about the report: "Companies are making a clear trade-off: AI investment is the priority, and employee compensation is the budget source. This is not just about layoffs. Bonuses, raises, equity, benefits, and base salaries are all being cut simultaneously, and this spans multiple industries."

In-Depth Analysis

This research comes amid growing concerns about AI's impact on the labor market. Since 2023, AI has been mentioned in 91,753 U.S. layoff announcements, accounting for about 3% of all layoffs during that period, according to data from career transition firm Challenger, Gray & Christmas.

On March 11, software company Atlassian announced it wouldcut 10% of its workforce, citing AI investment as a key driver of the decision. In a securities filing, the company said: "These actions are intended to rebalance the company to accelerate building the future of team collaboration in the AI era. This includes self-funding key strategic priorities such as AI and enterprise sales, restructuring teams to act more focused and faster within the Atlassian work system, and optimizing long-term operational efficiency and sustainability."

Another recent case is digital payments company Block, which last month said it plans to reduce its workforce from 10,000 employees to just over 6,000, while relying on AI to replace the eliminated roles.

According to the ResumeBuilder.com survey, fear of falling behind competitors is the main reason companies are cutting jobs and compensation to fund AI investments. 75% of respondents said AI will bring a competitive advantage, and 74% believe AI will drive revenue growth. More than half (56%) of respondents cited pressure from boards or investors to adopt the technology.

Haller added: "Boards and investors are asking tough questions about AI strategy, and leaders feel they cannot afford to sit on the sidelines. The risk of falling behind is seen as more urgent than the risk of losing talent. This is a short-sighted trade-off. When the job market shifts back in favor of employees, these companies will find it harder to attract and retain the talent they need."

However, a recent report by EY paints amore optimistic picture of AI's impact on the workforce. In the EY study, more than two-thirds of CEOs said that despite AI investments, they expect to maintain or increase their workforce by 2026; the proportion of CEOs expecting to reduce headcount fell to 24% in December, down from 46% in early 2025. Many respondents believe AI will reshape roles rather than eliminate jobs outright, shifting employees from routine transactional tasks to higher-value work.

Andrea Guerzoni, global vice chair of EY-Parthenon, said in the EY report: "This reflects that CEOs are taking a realistic and pragmatic approach, recognizing the need to add new skills and maintain human oversight in many AI use cases, at least in the near term."