artificial intelligence
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Employers are being urged to “maximize their budgets for employee satisfaction and productivity” as AI has yet to generate “practical labor cost savings.”
Global advisory firm WTW said there has been a “surge in investment in AI and automation pilots over the past two years as organizations test new ways to improve productivity and operational efficiency”, but this has not yet translated into savings.
“Therefore, it is important for organizations to proactively plan how to make the most of their budgets for employee satisfaction and productivity,” commented Gabriela Bergstedt, Associate Director of Work and Compensation at WTW.
She was commenting on new research into pay strategy which found a fifth of Irish employers are planning to cut their pay budgets in 2026.
A survey of Irish employers as part of WTW’s Global Payroll Budget Planning report suggests that pay budgets in Ireland remain stable, with 60% of employers leaving their salary budget forecast unchanged for this year and only 11% increasing it.
“Irish employers will enter 2026 with clearer pay priorities and greater discipline, using pay budgets as a strategic tool rather than just a fiscal input,” she said.
“But beneath the stable median lies important changes in the way organizations allocate pay, manage complexity, and plan for a workforce that continues to evolve faster than traditional budgeting cycles,” she added.
For employers changing their initial budget forecasts, he said inflationary pressures (17%), expected strong financial results (22%), concerns about a tight labor market (17%) and changes in compensation strategy (15%) are factors influencing pay budgets.
