What: A new wave of middle management layoffs is sweeping through retail and tech, driven by post-pandemic correction, cost-cutting, and the gradual adoption of AI and automation in administrative tasks.

Why it is important:  As AI and automation reshape retail, the evolving role of middle managers becomes critical for technology adoption, operational resilience, and future leadership development.

Middle managers are facing unprecedented pressure as companies across retail and tech aggressively cut management layers to improve efficiency and reduce costs. This trend is partly a correction after pandemic-era overhiring and overpromotion, especially in sectors that rapidly expanded during Covid-19. While AI and automation are often cited as drivers of these cuts, current data shows that most layoffs are not yet directly linked to AI; instead, automation is gradually taking over routine administrative and monitoring tasks. Despite these reductions, effective middle managers remain vital for driving technology adoption, upskilling teams, and maintaining operational resilience. Gen Z’s reluctance to pursue middle management roles, viewing them as high-stress and low-reward, is prompting organizations to rethink talent pipelines and management structures. The industry is now challenged to balance technological innovation with human leadership, ensuring that middle managers are empowered to bridge strategic vision and practical implementation as retail undergoes digital transformation.

IADS Notes: The current wave of middle management layoffs and organizational delayering in retail and tech, as reported by India Economic Times in March 2025 and Forbes in March 2025, reflects a sector-wide push for cost discipline and operational efficiency amid economic uncertainty and post-pandemic correction . Sifted in January 2025 and ERE Media in April and June 2025 highlighted that while AI and automation are gradually taking over administrative and monitoring tasks, there is not yet a direct link between AI adoption and management cuts; instead, the focus is on augmenting human capabilities and freeing up managers for more strategic work . The Financial Times in February 2025 and BCG in September 2025 noted that Gen Z’s reluctance to pursue middle management roles is prompting organizations to rethink talent pipelines and management structures . The IADS White Paper on Middle Management (2025) further underscores that effective middle managers remain crucial for driving technology adoption, corporate training, and operational resilience, especially as organizations navigate digital transformation. The White Paper recommends proactive talent management, leadership development, and a balanced approach to AI integration—ensuring that middle managers are empowered to bridge strategic vision and practical implementation in a rapidly evolving retail landscape.

Bonfire of the middle managers