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Managers Pull Back from AI Replacements as Worker Anxiety Persists

• By John K. Waters
• 04/27/2025

A growing number of managers say they no longer want to replace workers with generative artificial intelligence (AI) tools, according to a new survey, even as concerns about AI’s broader impact on jobs remain high.

The second annual survey by Beautiful.ai, a provider of AI-driven presentation software, found that 54% of managers reported no desire to replace employees with AI tools, up significantly from 39% a year earlier. Only 30% said replacing a large number of workers with AI would be financially beneficial, compared with 48% in 2024.

The shift suggests a cooling of initial enthusiasm for using AI as a direct substitute for human labor. Sixty-three percent of managers said they believe multiple employees they oversee could not be effectively replaced by AI without a significant drop in performance, an increase from 43% last year.

"While many managers still have concerns about job security, pay cuts, and employee resistance, fewer are viewing AI as a direct replacement for workers," said Jordan Turner, senior content strategist at Beautiful.ai, in a blog post. "Instead, companies are using AI to enhance productivity, streamline tasks and foster collaboration."

Anxiety Lingers
Despite the retreat from immediate replacement plans, worker anxiety remains widespread. Sixty-four percent of managers said their employees are worried that AI tools could make them less valuable at work, and 58% said their teams fear losing their jobs to AI.

The concerns are not unfounded. Following the explosive debut of OpenAI’s ChatGPT in late 2022, adoption of generative AI tools such as Microsoft's CoPilot, Google's Gemini, and Midjourney surged globally. While these tools have demonstrated productivity gains, their ability to "hallucinate" — or produce inaccurate results — and the potential for legal and morale issues have tempered corporate adoption. Some major firms, including Samsung Electronics Co. Ltd., have banned employee use of generative AI tools at work.

AI as an Aid, Not a Replacement
Beautiful.ai's survey shows that 77% of managers are adopting AI tools to boost worker productivity or improve efficiency, an 11-point increase from last year. At the same time, 65% cited employee resistance and fear of the unknown as their top concerns about AI in the workplace.

Worries extend beyond rank-and-file employees. Forty-four percent of managers said they fear AI could lead to lower pay for workers in management positions, and 41% believe AI poses a threat to their own salaries.

While AI tools may match the output of a "novice manager," according to 64% of respondents — a sharp rise from 2024 — many remain skeptical that AI can fully replicate human decision-making and leadership.

Broader Labor Market Trends
Findings from other recent studies reinforce the mixed picture. A report from Payscale Inc. found that 52% of HR executives surveyed had no plans to replace workers with AI, but 18% said they were actively doing so, and another 20% were considering it.

Research from the International Monetary Fund in 2024 estimated that AI would affect about 40% of jobs worldwide, replacing some and augmenting others. Meanwhile, a Harvard Business Review study tracking freelance gigs saw a 21% decline in listings for automation-prone work like writing and coding after ChatGPT’s release.

Moreover, researchers from Emory, Fordham, and Auburn universities warned that although AI can boost productivity, it could also lead to longer working hours. Their study found that increased surveillance and diminished bargaining power linked to AI use may ultimately erode leisure time for employees — contradicting predictions from figures such as Microsoft co-founder Bill Gates, who has suggested AI could shorten the workweek.

Cautious Path Forward
As businesses continue experimenting with generative AI, experts caution that companies should move carefully, balancing the potential for greater efficiency with the risks to morale, legal liability, and workforce stability. For now, it appears more managers are choosing to augment rather than replace — but anxieties on both sides of the workplace divide remain strong.