Concerns about the impact of AI on jobs are intensifying alongside rapid advancements in automation technology.
Recent evidence indicates that these fears may be well-founded.
A study from MIT in November estimated that around 11.7% of jobs could be automated with current AI capabilities. Surveys reveal that employers are already cutting entry-level positions due to this technology. Additionally, companies are citing AI as a reason for layoffs.
As businesses increasingly integrate AI, they may reevaluate how many employees they actually need.
In a recent TechCrunch survey, several enterprise venture capitalists expressed that AI will significantly affect the workforce by 2026, even though the survey didn’t specifically target this issue.
Eric Bahn, co-founder and general partner at Hustle Fund, anticipates labor impacts in 2026 but is uncertain about the specifics.
“I want to see which repetitive roles get automated and whether even more complex jobs with logic also become automated,” Bahn noted. “Will this lead to layoffs? Will productivity increase? Or will AI simply enhance current labor, making the workforce even more efficient? There are many unanswered questions, but something substantial is expected in 2026.”
Marell Evans, founder and managing partner at Exceptional Capital, forecasts that companies increasing AI investments will cut back on hiring.
“I believe that while we’re likely to see a rise in AI budgets, we will also witness more human labor being reduced, which will continue to significantly affect the U.S. job market,” Evans stated.
Rajeev Dham, managing director at Sapphire, concurred that by 2026, budgets will likely divert resources from labor towards AI. Jason Mendel, a venture investor at Battery Ventures, added that AI will evolve beyond just making existing workers more efficient.
“2026 will mark the shift to agents, where software moves from enhancing human productivity to automating work processes, fulfilling the promise of displacing human labor in certain sectors,” Mendel said.
Antonia Dean, a partner at Black Operator Ventures, commented that even if companies don’t officially allocate labor budgets to AI projects, they may still cite AI as a justification for job cuts or reduced labor expenses.
“The complexity here is that many companies, regardless of their readiness to implement AI solutions effectively, will claim they’re investing more in AI to justify cuts in other areas or workforce downsizing,” Dean explained. “In reality, AI might serve as a scapegoat for executives trying to mask past errors.”
While many AI firms argue that their technology doesn’t eliminate jobs but rather enables workers to focus on “deep work” or more skilled tasks by automating repetitive tasks, skepticism remains. There are concerns that automation will indeed threaten jobs, and discussions with venture capitalists investing in this field suggest that these worries are unlikely to dissipate by 2026.
