Investors Predict AI Is Coming for Labor in 2026

Concerns about how artificial intelligence will affect workers continue to grow alongside rapid advances in AI systems and new products promising automation and efficiency. Increasingly, evidence suggests those concerns may be justified.

A November study from MIT found that approximately 11.7% of existing jobs could already be automated using AI. Separate surveys show that employers are beginning to eliminate entry-level positions due to AI adoption, and some companies have explicitly cited AI as a factor behind layoffs.

As enterprises move from experimentation to deeper AI integration, many are reassessing how many employees they genuinely need.

In a recent TechCrunch survey, several enterprise-focused venture capitalists independently identified 2026 as a pivotal year for AI’s impact on the workforce, even though the survey did not directly ask about labour.

Eric Bahn, co-founder and general partner at Hustle Fund, said he expects significant labour effects to emerge in 2026, though the exact outcome remains uncertain.

“I want to see what roles that have traditionally involved repetition get automated, or even whether more complex roles requiring logic become automated,” Bahn said. “Will that lead to more layoffs? Higher productivity? Or will AI mainly augment existing workers? A lot of that is still unanswered, but something meaningful is likely to happen in 2026.”

Marell Evans, founder and managing partner at Exceptional Capital, believes rising AI budgets will come directly at the expense of human labour.

“As companies increase AI spending, I think we’ll see funding pulled from labor and hiring,” Evans said. “That will likely result in continued layoffs and further pressure on the U.S. employment rate.”

Rajeev Dham, managing director at Sapphire Ventures, echoed that view, predicting that 2026 budgets will increasingly shift resources from labour toward AI investments. Jason Mendel, a venture investor at Battery Ventures, added that AI’s role will evolve beyond simply boosting worker productivity.

“2026 will be the year of AI agents,” Mendel said. “Software will move from helping humans work faster to automating work itself, delivering labor displacement in certain areas.”

Not all workforce reductions will necessarily stem from successful AI deployments. Antonia Dean, partner at Black Operator Ventures, warned that AI may also become a convenient explanation for cuts driven by other factors.

“Many enterprises, regardless of how effectively they are using AI, will say they’re increasing AI investment to justify reducing spending elsewhere or trimming headcount,” Dean said. “In reality, AI could become a scapegoat for executives trying to cover past mistakes.”

AI companies often argue their tools don’t eliminate jobs but instead shift workers toward higher-skill tasks by automating repetitive work. However, that reassurance has done little to ease anxiety among workers. Given investor expectations, those fears are unlikely to fade in 226, as AI adoption accelerates and labour-market effects become harder to ignore.