The middle manager’s survival guide: overcoming layoffs, burnout, and AI

Leadership is being reimagined, with companies ‘flattening out’ in order to speed up decisions and improve margins. This process is taking its toll, particularly on middle managers. What steps can managers take to protect their position and safeguard their future?

 In 2024, Gartner suggested that by 2026, around 20% of organisations could use AI to significantly flatten their hierarchy, eliminating more than half of middle management positions. In reality the numbers aren’t quite that stark. But as management lay-offs climb, a trend is certainly emerging.

Amazon has let go 14,000 managers, about 4% of its white-collar workforce. Meta are redeploying 7,000 people, and crypto exchange Coinbase said it would cut around 14% of its global workforce. Jack Dorsey (a co-founder of Twitter), branded a decision at his fintech company Block to cut approximately 4,000 of its 10,000 employees as a move to replace middle managers with AI.

An essay co-authored by Dorsey explained that: “There is no need for a permanent middle management layer…. The question was never whether you needed layers. The question was whether humans were the only option for what those layers do. They aren’t anymore.”

This thought prompts three questions:

• What role do middle managers perform?
• Can AI replicate this?
• What can managers do to protect their position?

Middle manager leadership challenges

Traditionally, managers act as an essential way station, interpreting leaders’ objectives, passing decisions down to teams and individuals, and sending updates back up the chain of command.

This limited view of a manager’s role – largely facilitating communication and assessment – helps to explain why some see it as ripe for automation. However, beyond these responsibilities, managers also shape culture, oversee team dynamics, offer coaching and mentorship, and build purpose and morale.

Human skills are hard to replicate. They are just as difficult to measure. Their impact doesn’t readily show up on a spreadsheet – which is maybe why flattening is particularly prevalent in data-heavy sectors such as tech and financial services.

For managers still in position, staying engaged at work has become increasingly difficult. People who inherit extra reports can feel overwhelmed. According to a US survey by Gallup, the average number of people reporting to managers has increased from 10.9 in 2024 to 12.1 in 2025. This is a nearly 50% increase in team size since Gallup’s first assessments in 2013.

No surprise that many managers are nervously watching over their shoulder. Disengagement among managers has dropped by nine percentage points since 2022, according to Gallup’s 2026 State of the Global Workplace report. With fewer managers in place, team sizes are likely to grow – however, Gallup’s US survey found that manager engagement declines with larger spans of control.

How middle managers stay relevant 

Managers may want to take proactive steps to protect their position, reimaging their role by focusing in particular on human skills. For example, Gallup’s US survey found that providing meaningful feedback to each employee at least once per week nearly triples the percentage of engaged employees, which then influences other performance outcomes.

This human-centric focus has come to replace older ideas – in which AI promised a glittering future, at the expense of people. In the late 2010s, reports on leadership typically treated digital transformation mainly as a technology issue. Today, it’s recognised that tech allows a “reimagination of work that brings the best of humans and machines together”, as described by Deloitte.

Deloitte noted that organisations taking a purely technology-led approach to AI were reportedly 1.6x more likely to underperform expectations on AI returns than organisations taking a more human-centred approach.

This kind of analysis gives middle managers an opportunity to reinvent their role, outsourcing routine to AI and giving them time to focus on the human aspects of their work, such as:

1. Becoming a ‘player-coach’

The player-coach management model is a leadership structure where managers function as both leaders and individual contributors. People are harder to replace when they’re not ‘pure overhead’ management and are producing value that ties directly to performance.

Player-coaches remain operationally involved while still remaining accountable for team performance and alignment with business objectives. This model typically succeeds with small-to-medium teams and where there are high demands on expertise. It is particularly common in environments where speed, technical expertise, or customer proximity matter.

2. Focusing on high-value human skills

Middle management is an inherently social function. Talent-spotting leads to skills development, coaching, and mentoring. Managers in this role are feeding ability, rather than productivity data,  through to senior leadership. Deloitte’s research shows that developing your direct reports can boost their performance by as much as 27%.

Mentoring employees can have a meaningful impact on competitive edge. Research from the Wharton School of Management shows that it is the “individuals who fill the role of middle managers rather than the creative innovators” who best explain variation in company performance.

3. Orchestrating delivery

Flattened organisations tend to reduce layers, but they still need someone to coordinate across functions and deliver outcomes end-to-end. Managers who survive cuts increasingly act as:

• outcome owners rather than people supervisors
• connectors across teams
• decision-makers closer to the client

Reducing managers doesn’t cut the need for effective coordination. Managers capable of getting the best from their team are more likely to help them meet or exceed business objectives.

4. AI champions

An NBER survey of nearly 6,000 global executives found that 89% saw ‘no effect’ of AI on productivity. Research by Gallup suggests this can be traced to reluctance among leaders and managers to set an example to employees in embedding AI into personal workflows.

Managers who bridge the gap between AI and employees can help to increase productivity while protecting essential human skills (such as critical thinking). This is a leadership role that has the potential to boost the return on AI investment – the holy grail for many organisations.

Future of middle management 

Senior leaders choosing to reduce management headcount may find unexpected consequences. Flattening may streamline efficiency, but it can also increase workload. Leaders may bring upon themselves tasks that were once performed by people and that can’t be given to AI.

Losing managers may also expand the workloads of younger employees, not all of whom may be enamoured with corporate culture in the first place. Generation Z and millennials, looking upon the fate of managers and seeing additional tasks heading their way, may wonder how far a strategy of flattening fits with their well-documented interest in work-life balance.

For many younger people, a traditional corporate context is associated with burnout, unsustainable workloads, and insufficient support. The greasy pole is not especially attractive. Senior leadership is a primary career objective for just 6% of younger employees, according to Deloitte’s research. They’re not aspiring to be managers, other than in a setting that prioritises flexibility, wellbeing, and support.

Young people peg success to skills development and to mentorship, and to a line manager who can give them these things. In the words of Kristien Turner, founder and CEO of TK Talent Group, mentoring “wasn’t bureaucracy. That was leadership development happening in real time.”

Finally, the loss of middle managers can contribute to significant long-term hiring costs. Less support for rising stars means that organisations must fund expensive external recruitment drives when they need to recruit senior personnel.

Leadership skills training

Many organisations are aware of the need to reinvent management roles. How they choose to do this will affect people across the business, from top to bottom.

Gallup found that within best-practice organisations, 79% of managers were engaged at work – nearly quadruple the global average. These world-class workplaces span all regions and industries, prioritising employee engagement as part of their long-term business strategy.

At Working Voices, our leadership training courses are supported by a package of options that support managing uncertainty and leading through change. We recognise that leadership is becoming less about possessing expertise and more about:

• learning agility
• collaborative intelligence
• sense-making
• leading systems rather than silos

Senior leaders are being asked to do more, engagement is falling, and skills such as coaching are falling through the gaps.  Winning organisations are not simply adopting AI or accelerating change. They are taking a people-focused approach to redesigning leadership, culture and work itself.