May 27, 2026
AI Anxiety at Work Is Dismantling Employee Engagement – and Most Organisations Aren’t Responding
We have spent years building the infrastructure of employee experience (EX) with pulse surveys and wellbeing programmes. We have introduced flexible working policies, been intentional about DEI initiatives, recognition platforms and career development opportunities. But, right now, what is keeping employees up at night is sustained, unrelenting AI anxiety at work – and most EX strategies are not built to withstand it.
At present, 69% of employees expect their company to proceed with layoffs because of AI within the next three years. Nearly half of those people fear that they will personally lose their job.
Gallup’s 2026 State of the Global Workplace report tells us that global employee engagement has fallen to its lowest level since 2020, costing the global economy around $10 trillion a year. Manager engagement has collapsed even faster than employee engagement, dropping from 31% in 2022 to just 22% in 2025 – the steepest fall on record.
The very people we rely on to hold the human experience of work together – managers, team leaders and supervisors – have checked out emotionally because they are exhausted, uncertain and nobody is looking after them.
These are the same people we are now asking to lead their teams through an AI revolution.
What AI Anxiety at Work Actually Looks Like
With nearly 7 in 10 people believing that AI will lead to layoffs in their company, workers are living with a level of ambient fear that leaks into all aspects of their lives and changes how they work and how they relate to colleagues. This anxiety also affects how much of themselves they’re willing to invest in an organisation that might be engineering them out of existence.
It might be difficult to distinguish from what we have come to know as ‘disengagement’ or ‘quiet quitting’, but it’s definitely showing up at work on the daily. It looks like the employee who has stopped raising their hand in meetings – not because they don’t have ideas, but because they’re quietly calculating whether making themselves visible is going to increase or decrease their odds of survival.
You might see it in the manager who has started micromanaging again after years of working toward autonomy for their team. Not because they have regressed, but because they are anxious about their own relevance and this feels like the only aspect of their work they are still in control of.
The anxiety is showing up in the high performer who has started applying elsewhere because the organisation’s silence on AI has left them convinced that the people making decisions don’t view them as a long-term asset. It’s crept into teams that used to be creative problem-solvers, constructively challenging each other, but now play it safe in every direction because the psychological safety has been eroded by the suspicion that someone or something is watching and measuring everything they say or do.
The anxiety is also surfacing in something more organised. Across some of the world’s most recognisable tech companies – Meta, Google DeepMind, and Amazon – employees are moving from quiet frustration to active resistance, with protests, open letters, and attempts to unionise.
Deloitte’s ‘AI Cultural Debt’
Deloitte coined the term ‘AI cultural debt’ to describe the long-term cost that accumulates when organisations deploy AI without equal investment in the human systems surrounding it. It’s what happens when efficiency is prioritised and trust and psychological safety are treated like an afterthought. We see workflows being optimised and technology being implemented at people, rather than with them.
AI cultural debt accumulates quietly. Initially, the gains are visible as faster processes, leaner teams and cleaner data. The liabilities don’t show up on any dashboards:
The river that runs through it all is a slow, corrosive erosion of trust in leadership.
It’s devastating for EX, because it attacks the very foundation of belonging, purpose and autonomy and any sense that your contribution matters and is seen by humans who actually give a damn.
The Transparency Gap is an Emergency
Only 22% of global workers strongly agree that their job is safe from elimination. So 78% of the very people we are trying to engage, retain, develop and support, are operating under a cloud of job security and AI anxiet at work. A fear they are largely carrying alone because most organisations have not created the structures, the safety, or the leadership courage to address it directly.
Gallup’s 2026 data finds only about 26% of employees say their organisation has communicated a clear plan for integrating AI in their daily work and just 30% say that their manager supports AI use at work.
This points to a massive transparency gap, which, in EX terms, is not a communication problem but a trust crisis. Trust, once eroded, is extraordinarily difficult and expensive to rebuild.
Neuroscience is unambiguous on this: when people don’t have information, their brains generate threat responses and fill the vacuum with worst-case scenarios. People will assume that silence means that bad news is coming and they will behave accordingly by protecting themselves, withdrawing discretionary effort and preparing to leave. So, every week that passes without clear, honest, human conversations about what AI means for roles, skills and the future of work is another week in which that AI cultural debt is compounding.
The Manager Crisis: Why Middle Leaders Are Being Left Behind
Managers have lost what Gallup calls the ‘engagement premium’ – the historically higher engagement that came with the role and proximity to power and information. Managers are now, on average, only as engaged as the people they lead, yet they are being asked to champion AI adoption while carrying their own unprocessed anxiety about what AI means for them personally. They are being asked to have honest conversations with their teams about uncertainty when nobody has had those conversations with them. They’re being expected to model psychological safety while their own is being dismantled by restructures, increased team sizes, reduced support and the creeping sense that their role is next on the efficiency agenda.
Managers have been absorbing the full weight of post-pandemic disruption with inadequate support. They’ve had to deal with employee turnover, a hiring boom-and-bust cycle, digital transformation, rapid AI tool introduction, new employee expectations and restructured teams on shrinking budgets. We keep asking them to do more, with less.
Your Immediate Survival Strategy
Love it or loathe it, AI is not going anywhere and we are all going to be under significant pressure to lead AI adoption at work. In 2025, companies spent over $40 billion on AI implementation, yet 95% of respondents in the Gallup survey reported 0% ROI. AI is costing our organisations both financially and culturally. So how do we survive the tsunami?
Invest in Your Managers More
Invest in building manager capability and supporting both their mental health and career development.
When their managers actively support the use of AI by their teams, Gallup data finds that employees are 8.7 times more likely to view work as transformed by AI and 7.4 times more likely to agree that AI gives them more opportunities to do what they do best.
Provide Real Transparency About Your AI Strategy
The WTW Global EX Market Study 2026 finds that when employees understand why change is happening and how they fit into the future, wellbeing improves, engagement rises and organisations unlock higher performance and measurable value. Employees don’t need more resilience training or another wellbeing app and a webinar on mindfulness. They need real transparency about what AI is doing in their organisation, what it means for their roles and what the plan is for bringing people along, rather than leaving them behind.
Prioritise Authentic Humanity
Right now, people need more human connection and authentic vulnerability. Town halls simply won’t cut it, when what people are craving is community and an opportunity to ask the difficult questions or share their fears and uncertainty. They also need reassurance that AI isn’t just being used to automate them out of the employment equation, but, instead, to augment their abilities and experience at work.
If we are to survive this moment, we need to ensure that managers are supported, informed and genuinely equipped to lead through uncertainty, rather than simply to survive it. We have to make sure that all our people feel that they are valued for what makes them human – their judgment, creativity, their capacity for contextual thinking and their empathy – not just for the tasks that can be measured on a dashboard.
None of this is complicated, but all of it is urgent.
