‘As productivity gains begin to materialize, I’m seeing the conversation shift from efficiency to value’
Nearly half of Canada’s largest-company chief executives believe artificial intelligence (AI) will allow their organizations to achieve long-term growth with fewer employees – findings from two surveys pointing to a fundamental shift in workforce planning.
The global EY organization polled 1,200 chief executive officers in 21 countries between August and September 2026 for its CEO Outlook Survey, published on October 1, 2026. Among Canadian respondents at large companies, 46% believe many companies will reach their long-term growth targets with a smaller workforce than they have today. A companion Canada-focused poll of 50 senior executives – most heading publicly traded businesses with annual revenue above $1 billion (US) – returned consistent findings.
“As productivity gains begin to materialize, I’m seeing the conversation shift from efficiency to value,” said Shane Dunn, managing partner at EY-Parthenon Canada in Toronto. “An overwhelming majority of Canadian CEOs indicate they can measurably demonstrate a return from AI investments, with the primary productivity measure being higher output without additional headcount or capital.”
Where is the AI investment?
The global October 2026 report finds that four in five CEOs worldwide believe AI will have a greater effect on roles, skills, and how work is organized than on workforce size over the next three years. EY-Parthenon’s Spring 2026 Canada CEO Outlook – covering 50 Canadian executives polled in March and April 2026 – shows 80% of Canadian CEOs planned to increase AI spending this year, with none reporting plans to cut it.
In that spring Canadian survey, AI capital was split roughly evenly across efficiency automation, complex workflow restructuring, quality improvement, and business model innovation. Among Canadian respondents, reskilling and upskilling existing employees was ranked among the top two expected workforce impacts by 46%; redesigning roles to combine human and AI capabilities was cited by 34%; and reducing hiring in certain roles by just 20%.
That ambition runs ahead of readiness. As reported in HRD Canada’s analysis of how Canadian provinces are spending on AI workforce training in 2026, government reskilling investment has been uneven, and Ottawa’s national AI strategy, released in June 2026, found less than 15% of Canadian businesses currently use AI to produce goods or services.
The skills gap and what economists say
That gap shows up at the employee level too. As covered in HRD Canada’s report on Canada’s widening AI skills gap, a 2026 Ipsos survey on behalf of TD Bank Group found only 4% of Canadian respondents rated themselves highly proficient in AI.
On the ground, some HR leaders are taking a more measured view of what AI means for headcount. Lydia Iacovou, vice-president of HR at Ontario highway operator 407 ETR in Toronto, told Canadian HR Reporter that while efficiency gains could eventually influence workforce size, “we’re not chasing that today — today we’re chasing the benefits of AI and how we can do more.”
Economists share that outlook. In an October 2026 report, Rannella Billy-Ochieng’, senior economist, and Thomas Feltmate, director and senior economist, at TD Economics in Toronto concluded that widespread AI-induced job losses are not imminent. “Artificial intelligence has the potential to transform a substantial share of workplace tasks, but task exposure should not be confused with outright job losses,” the report states – consistent with the Bank of Canada’s own assessment, as covered in HRD Canada’s report on limited AI-related job losses in Canada to date.
For HR leaders, the findings carry a clear signal: the substantial share of Canadian CEOs envisioning a smaller future workforce are making investment decisions today that will shape hiring, role design, and skills requirements for years to come.
