External signal·HR Executive·Dec 19, 2025·Jill Barth·6 min read
The AI layoff trap: Why half will be quietly rehired
“Half of AI-attributed layoffs will be quietly rehired, but offshore or at significantly lower salaries.”
Summary
Drawing on Forrester's Predictions 2026: The Future of Work report, this piece argues two workforce crises are converging: experienced workers laid off for AI capabilities that don't yet exist, and new graduates locked out as entry-level roles vanish. Forrester predicts half of AI-attributed layoffs will be quietly rehired—offshore or at lower salaries—and notes 55% of employers already regret AI-driven layoffs, citing failures like Klarna replacing 700 staff before rehiring. Burning Glass Institute data show the share of postings requiring three years' experience or less fell sharply in AI-exposed fields between 2018 and 2024 (software development 43% to 28%, data analysis 35% to 22%) even as senior postings held steady. Only 16% of workers had high AI readiness in 2025.
Predictions for the future of work
Forrester forecasts that through 2026, premature AI layoffs followed by quiet offshore rehiring will accelerate across industries, with half of AI-attributed cuts reversed. Entry-level hiring in AI-exposed fields continues to erode as firms flatten structures and favor mid-career hires, risking a generation locked out, lost institutional knowledge and rising disengagement. The recommended path is AI-augmented apprenticeships and stricter evidentiary bars for layoffs.
Originally published by HR Executive · Dec 19, 2025
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