Investors predict AI will hit the job market in 2026

Concerns about the impact of AI on workers continue to grow as advances and new products promise automation and efficiency.

The facts suggest that the fear is justified.

November MIT one study found that about 11.7% of jobs could already be automated thanks to AI. Investigations have shown employers are already cutting entry-level jobs because of technology. Companies also already emphasize AI as a reason for layoffs.

As companies adopt AI more significantly, some may take a closer look at how many employees they actually need.

In a recent TechCrunch survey, several venture capital firms said that AI will have a big impact on enterprise workforces in 2026. This was particularly interesting because the survey did not specifically ask about it.

Eric Bahn, co-founder and general partner of Hustle Fund, expects to see work impacts in 2026. He just doesn’t know exactly what that will look like.

“I want to see which roles known for their greater repetition are automated, or which even more complicated roles with more logic become more automated,” Bahn said. “Will this lead to more layoffs? Will productivity be higher? Or will AI simply be an augmentation to make the existing job market even more productive in the future? This all seems unanswerable, but it looks like something big is going to happen in 2026.”

Marell Evans, founder and managing partner of Exceptional Capital, predicts that companies looking to increase their spending on AI will pull money from their workforce and hiring reserve.

“I think that in return for a gradual increase in AI budgets, we will see more reductions in the human workforce and layoffs will continue to have an aggressive impact on the employment rate in the United States,” Evans said.

Rajeev Dham, chief executive of Sapphire, agreed that 2026 budgets will begin to shift resources from labor to AI. Jason Mendel, venture capitalist at Battery Ventures, added that AI will begin to move beyond just being a tool to make existing workers more efficient in 2026.

“2026 will be the year of agents, as software moves from supporting human productivity to automating work itself, realizing the value proposition of displacing human labor in certain areas,” Mendel said.

Antonia Dean, a partner at Black Operator Ventures, said that even if companies don’t shift their labor budgets toward AI projects, they will likely say that AI is the reason for layoffs or a reduction in labor costs anyway.

“The complexity here is that many companies, whether or not they are ready to successfully use AI solutions, will say they are increasing their investments in AI to explain why they are reducing spending in other areas or reducing their workforce,” Dean said. “In reality, AI will become the scapegoat for leaders seeking to cover up their past mistakes. »

Many AI companies say their technology doesn’t eliminate jobs, but rather helps move workers into “deep work” or higher-skilled jobs, while AI simply automates repetitive “busy work.”

But not everyone accepts this argument, and people fear that their work will be automated. According to venture capital firms investing in this area, it does not appear that these fears will be allayed in 2026.