Nearly seven in 10 US employees now fear artificial intelligence (AI) will lead to layoffs at their company within the next three years, according to a new workplace mental health report that paints a stark picture of rising burnout, worsening anxiety and collapsing trust in employers.
The report from workplace mental health platform Modern Health, based on responses from 1,000 full-time employees at companies with more than 250 workers, found that workers are increasingly overwhelmed by AI-driven productivity pressure, political instability, economic uncertainty, and always-on work cultures.
Among the report’s most alarming findings:
- 69% believe AI will lead to layoffs at their company
- 58% say they trust AI chatbots more than HR for mental health support
- 63% report using alcohol, cannabis, or unprescribed drugs to cope with stress
- 51% say they cried because of work stress in the past month
- 72% believe employers prioritize productivity over employee wellbeing
The findings suggest workplace mental health concerns are no longer isolated wellbeing issues, they are increasingly becoming operational, cultural and economic risks for employers as AI transformation accelerates faster than organisational trust and support systems can adapt.
‘EXTRAORDINARY’ COLLISION OF STRESSORS AT WORK
“We’re seeing an extraordinary collision of stressors across the US workforce – AI, economic pressure and global uncertainty – driving a level of strain that’s no longer sustainable, and it’s starting to show up in very visible ways,” said Alison Borland, Chief People and Strategy Officer at Modern Health. “Simultaneously, expectations are rising and many employees don’t feel supported. That imbalance is manifesting in concerning levels of anxiety and unhealthy coping mechanisms.”
The report echoes wider concerns raised during Stress Awareness Month 2026, which highlighted how AI disruption, financial insecurity, always-on work cultures, and job uncertainty are driving sustained burnout across both the UK and US workforce.
A global study from Gallup also found worker stress remains at historic highs across both countries, underlining the scale of the issue facing modern workplaces, as reported.
EMPLOYER TRUST BREAKING DOWN
Despite 76% of employees reporting adequate mental health coverage through workplace benefits, confidence in employer support continues to erode. Just 33% strongly agree that their employer values their mental health, down sharply from 41% in 2025 – an 8-point decline in a single year.
The breakdown in trust is increasingly pushing workers away from traditional support systems:
- 50% avoid using mental health days out of fear of judgment
- 65% have hidden mental health struggles to avoid appearing weak
- 72% believe employers prioritise productivity over wellbeing, up from 61% in 2025
Senior managers appear especially affected by workplace stigma:
- 54% report being judged for taking mental health days
- 61% avoid taking them altogether out of fear
Meanwhile, 88% of employees say workplaces need cultures that actively encourage use of mental health resources. The findings reflect a broader tension emerging across workplaces globally. Employees increasingly expect empathy, flexibility and psychological safety, while many employers continue prioritising productivity and efficiency.
A recent report exploring how workplace stress is increasingly spilling into employees’ personal relationships, physical health and lives outside work, reinforces concerns that burnout is becoming both a workplace and societal issue.
AI LAYOFFS & ANXIETY FUELLING WORKPLACE STRESS
Artificial intelligence is emerging not just as a technological disruption, but as a growing source of workplace anxiety. Nearly seven in ten employees (69%) believe AI will lead to layoffs at their company within three years, while 49% fear personally losing their job to AI. The psychological impact is already measurable:
- 24% say AI is negatively affecting their mental health today
- 67% say AI has increased productivity expectations
- Of those employees, 64% report increased stress directly tied to those expectations
The pressure appears particularly acute among senior managers:
- 80% say AI has increased expectations of their output
- 74% expect AI-driven layoffs within their company
- 57% fear losing their own jobs to AI
The findings come amid rapidly intensifying fears around AI-driven redundancies and workforce restructuring. A recent report found that six in 10 companies are planning to lay off employees who fail to adapt to AI tools and workflows.
The growing psychological impact of AI-related job insecurity was also highlighted during Stress Awareness Month 2026 coverage, which found employees increasingly moving from concerns about workload to fears around long-term employability and replaceability.
POLITICAL STRESS BECOMING A WORKPLACE ISSUE
The report also highlights the growing influence of political and global instability on employee mental health. It found that:
- 70% say the U.S. political climate has made it harder to maintain positive mental health at work
- 52% cite war and terrorism as top workplace mental health stressors
- 50% say current events negatively affect their workplace wellbeing
Employees increasingly expect employers to respond:
- 89% say more workplace mental health support is needed
- 71% believe workplace mental health support can reduce politically driven anxiety
- 66% believe leadership has a responsibility to address social, political or cultural issues affecting employees
Among Gen Z workers, that expectation rises to 72%. Yet many leaders appear unprepared as only 41% of senior managers feel very confident navigating polarising issues such as politics, immigration, or global crises The findings reinforce how external instability is increasingly shaping workplace culture, wellbeing and employee expectations of leadership.
INCREASING SUBSTANCE USE FOR WORKPLACE STRESS
One of the report’s most alarming findings is the extent to which employees are relying on substances to manage workplace stress. Nearly:
- 63% report using alcohol, THC/cannabis or unprescribed pharmaceuticals after work to cope with stress
- 52% say they have used substances during the workday itself
Among Gen Z workers:
- 59% use cannabis after work
- 51% use THC products during the workday
- THC use now exceeds alcohol use for stress management in this demographic
“Although we can’t identify ongoing patterns of use from these data, it’s concerning to see so many respondents report using alcohol or drugs to cope with stress,” said Dr. Jessica Watrous, Chief Clinical Officer at Modern Health. “Research has demonstrated that why you drink – perhaps to counter negative emotions – can be a risk factor for long-term problems. When a majority of employees report turning to substances to manage stress, it points to a gap in how people are accessing support and building healthier coping strategies.”
The data suggests many employees are no longer simply burned out, they are struggling to regulate stress in sustainable ways, with many turning to substance use. These findings echo the results of previous studies, showing that workplace stress has contributed to serious mental health challenges, such as substance use, as reported.
BURNOUT BECOMING PHYSICALLY VISIBLE
The cumulative impact of workplace stress is increasingly showing up physically and emotionally. The study found that:
- 48% say work negatively affected their mental health over the past year
- 84% say burnout is hurting productivity
- 72% felt pressured to work through mental health struggles
- 57% feel pressure to respond to work messages outside office hours
In the last 30 days alone:
- 51% cried because of work stress
- 52% experienced anxiety or panic-like symptoms at work
The findings reinforce concerns that burnout is shifting from an occasional workplace issue to a chronic workforce condition. Previous research found that one-third of US workers were already reporting worsening burnout levels, suggesting workplace stress has continued intensifying rather than improving over time.
MANAGERS ARE STRUGGLING WITH STRESS TOO
While senior managers report relatively high levels of mental health satisfaction on paper, the underlying data suggests many are under severe strain. The study showed that:
- 40% received a new mental health diagnosis in the past year
- Compared to just 13% of non-managers
- 82% say being a manager is harder than ever
- Only 37% feel equipped to identify burnout in their teams
Additionally:
- 24% say their teams’ mental health worsened in 2026
- 27% say their own mental health worsened compared to 2025
The findings highlight a growing leadership challenge. Managers are increasingly expected to support employee wellbeing while often struggling themselves. In fact, another recent study found that 40% of stressed-out leaders considering stepping down to prioritise their wellbeing.
The pressures are even greater for employees balancing caregiving responsibilities alongside work stress. Recent reports highlight surging burnout among “sandwich generation” workers caring for both children and ageing parents. Similarly, Fair Play Talks reported that two-thirds of working women in the sandwich generation are now considered at high risk of burnout.
PRACTICAL GUIDANCE FOR EMPLOYERS
The report suggests many workplace mental health strategies are no longer keeping pace with the scale of employee anxiety, burnout, and distrust. Experts increasingly argue that employers need to move beyond performative wellbeing initiatives and build systems employees genuinely trust.
1. Normalise mental health support from leadership
Employees are unlikely to use mental health resources if leaders visibly avoid them themselves. Organisations should encourage senior leaders and managers to openly discuss wellbeing, burnout, and boundaries without stigma.
2. Reassess AI rollouts through a human lens
AI implementation strategies should include transparent communication around job impacts, retraining opportunities, workload expectations and psychological safety, not just productivity targets.
3. Train managers to handle emotional strain
Many managers are being asked to support teams through burnout, political tension and uncertainty without adequate preparation. Mental health literacy and empathetic leadership training are becoming critical management skills.
4. Reduce always-on work cultures
The pressure employees feel to remain constantly available is significantly contributing to stress and burnout. Employers should reassess after-hours communication norms and workload expectations.
5. Build trust before expanding benefits
The findings suggest the problem is not simply access to benefits, it is whether employees feel psychologically safe using them. Policies without trust are unlikely to improve outcomes.
6. Treat mental health as a strategic workforce issue
Mental health is increasingly linked to retention, productivity, engagement, innovation, and employer reputation. Companies that fail to address workforce wellbeing risk deeper organisational instability over time.
As Fair Play Talks has previously reported, experts increasingly warn that burnout, stress, and AI anxiety are no longer isolated wellbeing concerns, they are becoming structural business risks affecting absence, retention, engagement and organisational trust.
The findings from Modern Health reveal a workforce under mounting pressure from nearly every direction: AI disruption, economic uncertainty, political instability, burnout and collapsing trust in workplace support systems.
The challenge for employers is no longer simply offering mental health benefits. It is proving to employees that workplace wellbeing matters as much as productivity. And in an era where trust is becoming one of the most valuable assets organisations have, companies that fail to address that gap may face consequences far beyond burnout alone.
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