At the World Economic Forum in Davos this January, executives and thought leaders painted an inspiring picture of the future of work. The message was clear: AI will handle the routine work, while humans will be elevated to “higher-value” activities such as creativity, judgment, relationships, and purpose. One World Economic Forum piece asked, “What if the real promise of generative AI is not efficiency, but the chance to make work more human?” Pearson’s CTO drew a sharp distinction: “Automation delivers quick, measurable efficiencies; AI-augmented workforces rewire how value is created.”
It’s a compelling narrative, and we want to believe it. But then we look at what’s actually happening in organizations right now and see a completely different reality. We see one where the same executives championing “human value creation” are systematically dismantling the very infrastructure that makes it possible.
The Great Flattening Is Here And It’s Not What They Promised
We’re in the middle of what experts are calling “The Great Flattening”, which is a mass elimination of middle management positions across industries. In 2024, middle managers made up 29% of all layoffs, a spike of more than 30% compared to the 2018–2022 average. Middle management job postings are down 42% compared to 2022. And this isn’t just a tech story anymore; it’s spread to retailers like Walmart, Wayfair, and Starbucks, and finance companies like HSBC and Ernst & Young.
Gallup data highlights that in 2013, the average manager supervised five people. In 2026, it’s 12. And Gartner reports that U.S. managers are overseeing three times the number of staff they did in 2015.
At the same time that we’re seeing managers having to oversee more employees than ever, Gartner estimates that 20% of organizations will use AI to flatten their structures by the end of 2026, eliminating over half of these middle management positions.
So, to be clear, the plan is to elevate humans to creativity, judgment, and purpose by eliminating the people who develop humans?
The Layoffs Are Based on a Fantasy
We know that these cuts aren’t being driven by AI working, but rather they’re being driven by the idea of AI working.
A Harvard Business Review analysis published in January found that companies are laying off workers based on AI’s potential, not its actual performance. Meanwhile, MIT has reported that over 95% of generative AI deployments at businesses fail to make any tangible improvement to profit or loss.
Deutsche Bank analysts have a term for this: “AI redundancy washing.” In other words, using AI as a cover story for cost-cutting that’s really driven by economic pressures and past overhiring. As Oxford Economics pointed out, AI-attributed job cuts represent just 4.5% of total reported job losses, while losses attributed to standard “market and economic conditions” were four times larger.
Randstad CEO Sander van’t Noordende told CNBC at Davos: “I would argue that those 50,000 job losses are not driven by AI, but are just driven by the general uncertainty in the market. It’s too early to link those to AI.”
So organizations are firing people based on speculation, citing technology that mostly doesn’t work yet, and using it as the justification for restructuring that’s really about cost– and then going to Davos to talk about humans flourishing. Got it.
The Human Cost of “Efficiency”
When you double a manager’s span of control from five people to 12, you don’t just create a scheduling challenge. You fundamentally destroy the conditions required for the “higher-value work” everyone claims to want.
As workplace expert Brian Weiss noted: “Your manager affects your mental health more than your doctor or therapist and just as much as your spouse. When companies stretch managers so thin they can barely keep up with their current team, let alone take on three times more people, they’re basically destroying the relationship that most determines whether you’re happy, satisfied, and engaged at work.”
Gallup data tells us that employees who receive meaningful feedback from their manager at least once per week are nearly three times more likely to be engaged. How exactly is a manager with 12 direct reports, who is likely still handling their own individual contributor work on top of it, supposed to provide that?
The Question Nobody at Davos Is Asking
When executives say they’re moving humans from “efficiency work” to “value creation,” we need to ask: Whose definition of value? And who gets to make that move?
Because right now, the pattern is clear. The people being “elevated” to creative, strategic, higher-value roles tend to be senior leaders and knowledge workers who already have proximity to power. The people being eliminated, squeezed, or left to absorb impossible workloads tend to be middle managers, entry-level workers, and the operational backbone of organizations.
Stanford researchers found a 13% decline in employment for workers aged 22-25 in AI-exposed jobs since late 2022. An Ivey Business School professor warned that cutting entry-level positions for cost savings is an “exponentially bad move” that threatens the entire internal talent pipeline. And BlackRock’s Larry Fink raised the alarm at Davos about a “bifurcated workforce” where AI benefits accrue narrowly to those who own the technology or possess high-level strategic skills, leaving a large portion of the labor market behind.
This isn’t just a management problem, an equity problem, or a systems problem. And it’s exactly the kind of problem that can’t be solved by the same short-term, efficiency-first thinking that created it.
What Actually Moving to “Value Creation” Would Require
We’re not arguing against the vision. A world where AI handles repetitive work and humans focus on judgment, creativity, relationships, and meaning sounds wonderful. But getting there requires investment, not extraction. It requires building capacity, not gutting it.
Here’s what genuinely moving from efficiency to value creation would look like in practice:
Invest in the people who develop people. If managers are the number one influence on whether employees are engaged, healthy, and growing, then eliminating them is the opposite of a value creation strategy. Organizations serious about elevating human work need more investment in management quality, not less.
Close the gap between AI adoption and human readiness. As the WEF’s own research acknowledges, workers report saving time with AI tools, but only 25% receive any formal AI training from their employers. You can’t declare a shift to “higher-value work” without actually preparing people for it.
Stop using AI as a cover story. If the layoffs are about economics, say so. If they’re about restructuring, own it. “AI redundancy washing” erodes trust, and trust is the foundation of every single “higher-value” human capability these executives claim to want.
Think in systems, not headcount. Every cut cascades. When you eliminate a layer of management, you’re not just removing a salary line, you’re removing mentorship, development pathways, institutional knowledge, decision-making capacity, and the human relationships that hold organizations together. At Inclusion Geeks, we use the SHIFT framework precisely because these decisions don’t happen in isolation.
Ask the foresight question. What does the talent pipeline look like in three-to-five years if you’ve eliminated the middle? Who develops the next generation of leaders when there’s no one between the C-suite and the individual contributor? What happens to organizational resilience when every remaining employee is stretched to their limit? These are the questions strategic foresight exists to answer, and the questions the current “efficiency” playbook is actively ignoring.
The Real Shift
The conversation about moving from efficiency to value creation is the right one. But it requires honesty about where we actually are, not aspirational keynotes that contradict what’s happening on the ground.
Right now, most organizations aren’t moving from efficiency to value creation. They’re using the language of value creation to justify a deeper entrenchment in efficiency-at-all-costs thinking. They’re calling it transformation while executing the same old playbook: cut costs, do more with less, let the remaining people figure it out.
The organizations that will actually thrive in what comes next are the ones willing to do the harder work: investing in human capacity, building systems that distribute power and opportunity more equitably, and making decisions based on where things are actually going, not where the hype cycle says they should be.
The future of work can be more human, but only if we stop pretending that firing humans is the way to get there.