Gartner analysis reveals three hidden workforce costs that could undermine AI investment returns for HR leaders
Chief human resources officers (CHROs) must identify hidden workforce costs created by artificial intelligence adoption or risk undermining the return organisations expect from their AI investments, according to analysis published by Gartner.
The guidance, issued through a Q&A with Jan Bansch, a senior director analyst in Gartner's HR practice, identifies three workforce cost risks tied to AI rollouts: rising AI talent costs, strain on pay-for-performance systems and unplanned expenses from layoffs.
The warning lands as AI spending accelerates. A November 2025 Gartner survey of 469 CEOs found 88% of organisations plan to increase AI investment, raising pressure on HR leaders to show measurable returns.
Three cost risks identified
Demand for AI skills has driven compensation for AI-related roles to three to four times that of the average worker, according to Gartner. At the same time, the relevance of those skills is shrinking, with skill life cycles narrowing to as little as two to five years, raising the risk that organisations pay premium wages for capabilities that quickly lose value.
A second risk involves performance pay. AI is increasing the speed and volume of work, but most organizations have not adjusted performance expectations or compensation structures accordingly, creating exposure to unintended payouts and misaligned incentives, Gartner found.
The third risk centres on layoffs. AI-driven productivity gains are prompting workforce reductions, particularly in early-career roles, but many of those roles may ultimately need to be rehired. Gartner predicts that by 2029, up to 30% of employees displaced by AI will be rehired, often at higher cost.
That projection lines up with rehiring already underway. Robert Half reported that 29% of organisations that cut staff in AI-related reductions had already rehired into the positions they eliminated. Separately, Forrester found that 55% of executive decision-makers who replaced employees with AI expect to regret the decision within 18 months.
Recommended actions for HR leaders
Gartner outlined three steps for CHROs to manage the exposure. CHROs should partner with technology and finance leaders to identify which AI skills are most critical and target compensation accordingly, while weighing the risk of overpaying or overhiring for roles that may depreciate quickly.
On layoffs, Gartner recommends CHROs engage executive leaders to evaluate the longer-term impact of workforce reductions, including the potential need to rehire and the effect on talent pipelines. Gartner
The firm also called for compensation systems to be revisited. CHROs are positioned to lead conversations with executives on how AI-driven productivity changes affect performance metrics and compensation structures, identifying unintended outcomes before they surface, according to Gartner.
Underlying the guidance is a broader budgeting concern. The primary risk to AI ROI stems from unexpected, unbudgeted workforce transformation costs, which can exceed the cost of the technology itself, Gartner said, noting that workforce changes are frequently managed without a full view of their financial implications.
