Why Companies Can’t Expect Employees to Be Loyal Anymore

Loyalty, still often seen as one of the best qualities an employee can have, has been declining over the past few years.

In a 2024 survey from the professional services and software technology platform WorkProud, only 16% of workers aged 42 or younger said they’d remain loyal to their company if they found a similar role that paid more elsewhere. 1

Loyalty no longer translates to better pay

Employees feel that loyalty is no longer rewarded, particularly when it comes to salaries. In a 2026 report from the payment processing company ADP, workers who switched jobs saw their pay increase by 6.4% year over year in January, compared to 4.5% for those who stayed with the same company. 2

For many workers, wages aren’t keeping up with the rising cost of living. According to a report from the Ludwig Institute for Shared Economic Prosperity (LISEP), the bottom 60% of working Americans don’t earn enough for what the researchers call a “minimal quality of life,” factoring in the cost of things like the technology needed for work, professional clothing, and transportation. 3

Employers aren’t listening to workers

On top of the cost-of-living crisis Americans face, there’s a growing disconnect between what employers want and what their workers are demanding. This is perhaps most clear when you look at return-to-office (RTO) mandates.

Despite 98% of full-time employees saying they’d prefer to work at least partly remotely, bosses are pushing workers to return to the office. 4 Paramount Skydance recently announced that employees will be required to work on-site if they live within 50 miles of an office, and Microsoft has also said workers need to come into the office at least 3 days a week.

Based on data from the Pew Research Center, employees feel working from home is better for their professional and personal lives. 5 Employers, on the other hand, say that employees work better in person. Adding to this tension is the recent surge in gas prices across the US due to the Iran war. For the average American, commuting to work has become far more costly.

The upshot is that employers are out of touch with the realities of their workers. If your boss doesn’t understand what you want, or, even worse, actively goes against it, it’s only natural that your loyalty to the company will fade.

In 2026, workers increasingly believe they’re dispensable. According to one Redditor who posted in the r/antiwork subreddit, “Human workers are just a ‘cost’ in the minds of corporations. A cost they can discard whenever it suits them.”

Business leaders have essentially said the same themselves. In a 2025 memo from AT&T, CEO John Stankey stated that the company is moving away from elements like “loyalty” and “tenure” when it comes to determining pay. Instead, Stankey said that AT&T wants to transition to “a more market-based culture—focused on rewarding capability, contribution, and commitment.”

Although many companies still expect loyalty from their staff, it is no longer something that employees can rely on getting in return. In the past few years, two factors in particular have driven this shift.

The mass layoffs in the US

Over 100 companies, including big names like Amazon and eBay, have announced plans to cut jobs in 2026, and even long-term employees aren’t immune.

One former employee of the tech company Oracle told Business Insider that she was laid off despite being at the company for 10 years. She said that finding out she lost her job via email, despite her years of service to the company, “felt cold.”

Business leaders have cited AI as one of the leading reasons for the ongoing layoffs. Others have argued that pandemic-era overhiring, slowing economic growth, and rising costs due to Trump’s tariffs are the primary drivers.

Regardless of the reasons, the result remains the same—less job security for workers.

AI disruption

With technology consolidating many roles, one employee using AI can handle work that previously required multiple people.

For loyal employees, consolidation is a growing threat. One Amazon worker who was laid off in October last year told The Guardian that AI had contributed to her losing her job. She said that her actual work wasn’t going anywhere, but that Amazon was going to hire a “more junior person” to do the same work for less pay with the help of AI.

Some companies are also demanding that workers accept AI workflows. Shopify’s CEO, Tobi Lütke, said in a memo last year that using AI is “now a fundamental expectation” for anyone working at the company. Lütke said he wanted managers to prove that AI couldn’t do a better job than them.

While companies may be keen to implement AI, many white-collar workers are reluctant to embrace these tools. In a 2026 survey from the SAP subsidiary WalkMe, more than 54% of workers said they’d bypassed their company’s AI tools in the past 30 days and completed the work manually instead.

The loss of loyalty doesn’t just affect morale, it directly impacts performance. Workers who are more engaged and happier tend to perform better.

A 2026 study from MetLife found that companies with “holistically healthy” employees (i.e., secure in their mental, physical, social, and financial health) experienced a 25% increase in productivity. 6

Although it’s clear that prioritizing employee wellbeing benefits businesses as well as workers, many companies seem reluctant to do so. If the disconnect between employers and employees continues, loyalty will only continue to weaken.

Many younger workers are already keen to leave the corporate world and work for themselves. In a study from SideHustles.com, 85% of Gen Z workers said they were interested in starting their own business. If employers want to retain their staff, they’ll need to start rebuilding loyalty now.

Business leaders face an uncomfortable truth—if they want to stay productive, they’ll have to take better care of their employees.

This is easier said than done. AI tools aren’t going anywhere, and companies that don’t capitalize on new technologies run the risk of getting left behind. Rising business costs resulting from tariffs also make it challenging for employers to balance their books.

That said, there are still ways that employers can improve relations with their employees and rebuild loyalty in the workplace:

1. Provide generous severance packages

Unfortunately, layoffs are sometimes inevitable. However, businesses should at least provide laid-off workers with fairer severance packages, especially those who’ve shown loyalty.

Severance packages should reflect the current economic conditions in the US, especially how difficult it is to land a new job. Employers should also help their former employees find new jobs, either by providing networking opportunities or referrals.

Workers are unlikely to be totally satisfied after being laid off, but at the very least, companies can show them that they valued their contributions.

2. Invest in employee AI training

With many employees at risk of losing their jobs to AI, companies should actively train workers to use these tools. In LinkedIn’s 2025 workplace learning report, 4 in 5 workers said they want to learn more about AI and how it can be used in their roles.

This is particularly important for earning loyalty from younger workers. In SideHustles.com’s survey, 1 in 4 Gen Z workers said that better mentorship and career guidance would make them reconsider quitting their jobs. 7

Unfortunately, in LinkedIn’s report, only around 38% of US executives said they’re currently helping workers become AI-literate. Teaching employees how to use AI effectively will not only help workers develop their careers, it will also boost productivity down the line.

3. Offer salaries that reflect the current cost of living

One of the main reasons people leave their jobs is to find higher-paying opportunities. If companies want to retain long-term employees, they need to start compensating them better.

Salaries should reflect the current cost of living. This may seem like a challenge in an unpredictable market marked by slow growth. That said, many US executives receive handsome pay increases while their employees struggle to make ends meet. According to The Wall Street Journal, the CEOs of JPMorgan Chase, Bank of America, Citigroup, Goldman Sachs, Morgan Stanley, and Wells Fargo each earned $40 million or more last year. Collectively, that’s a 21% increase from 2024.

Rather than continuing to increase executive compensation, companies should prioritize their employees. Otherwise, they’ll only foster resentment in their workers.

4. Prioritize employees’ mental health

As illustrated by MetLife’s study earlier, happy employees are more productive. In reality, a large portion of the US workforce is struggling with their mental health.

According to a 2021 survey from Mind Share Partners, 76% of US workers reported at least one symptom of a mental health condition. 8 The American Psychological Association (APA) also reported that 81% of workers look for employers that support mental health.

The US Department of Health and Human Services (HHS) recommends that employers increase access to paid sick leave and respect boundaries between work and non-work time. 9 If workers feel they are respected and listened to, especially when it comes to their mental health, they’re more likely to stay and invest in the company’s success.