Concerns over how artificial intelligence will affect workers continue to rise alongside rapid advances in AI technologies and a steady stream of new products promising increased automation and efficiency.

Evidence suggests these fears may be well-founded. A November study from MIT estimated that 11.7% of existing jobs could already be automated using current AI capabilities. Surveys also indicate that employers are beginning to eliminate entry-level roles due to AI adoption, with some companies explicitly citing AI as a reason for recent layoffs.

As enterprises adopt AI more aggressively, many may begin reevaluating how many employees they actually need. In a recent TechCrunch survey, multiple enterprise-focused venture capitalists predicted AI would have a significant impact on the workforce in 2026—despite the survey not explicitly asking about labor disruption.

“I want to see what roles that have been known for more repetition get automated, or even more complicated roles with more logic become more automated,” said Eric Bahn, co-founder and general partner at Hustle Fund. “Is it going to lead to more layoffs? Is there going to be higher productivity? Or will AI simply augment the existing labor market? All of this remains unanswered, but something big seems likely in 2026.”

Marell Evans, founder and managing partner at Exceptional Capital, predicted that companies increasing AI spending will reallocate funds away from labor and hiring budgets.

“On the flip side of increased AI budgets, we’ll see more human labor cut, and layoffs will continue to aggressively impact the U.S. employment rate,” Evans said.

Rajeev Dham, managing director at Sapphire, echoed the view that 2026 budgets will increasingly shift resources from labor toward AI. Meanwhile, Jason Mendel, a venture investor at Battery Ventures, suggested AI will evolve beyond productivity enhancement to direct labor replacement.

“2026 will be the year of agents as software expands from making humans more productive to automating work itself, delivering on the human-labor displacement value proposition in certain areas,” Mendel said.

Not all investors believe AI will always be the true driver behind workforce reductions. Antonia Dean, partner at Black Operator Ventures, warned that AI may increasingly be used as a justification for layoffs, even when deeper operational issues are at play.

“Many enterprises, regardless of their readiness to successfully deploy AI, will say they are increasing AI investments to explain why they are cutting spending elsewhere or trimming workforces,” Dean said. “In reality, AI may become a scapegoat for executives looking to cover for past mistakes.”

AI companies often argue that their tools do not eliminate jobs but instead shift workers toward more meaningful, higher-skilled roles by automating repetitive “busy work.” However, skepticism remains high, and concerns about job displacement continue to grow.

According to investors actively funding AI-driven automation, these fears are unlikely to be resolved in 2026, as enterprises push forward with adoption and experiment with increasingly autonomous systems.