Hello and welcome to Work Week, the podcast where we tackle one big question about the rapidly evolving workplace, explore what the research says about the issue, and explain what it all means for you.

I’m Dr. Gabby Burlacu, Senior Manager at The Upwork Research Institute. What you’re hearing today are my words, brought to life by a digital proxy of my voice, created by our team using AI. 

In this episode, we’ll dive into a topic that’s quietly fueling a lot of workplace anxiety, curiosity, and confusion. 

This week’s big question is: Are managers still needed in an AI-driven workplace?

It’s a question that’s gaining urgency. With artificial intelligence tools increasingly embedded in our work — from project planning to performance feedback — some business leaders are beginning to wonder: Do we still need that middle layer of management? Or can AI now do that work — cheaper, faster, and maybe even better?

In episode nineteen of Work Week, we discussed a closely related topic: What Role Do Middle Managers Play in an AI-Driven Workplace? The episode explored how middle managers are being asked to redesign workflows, integrate AI tools, and maintain team cohesion — all while facing declining engagement and rising burnout. And we emphasized that middle managers remain critical — they’re evolving into orchestrators of hybrid workforces made up of humans, freelancers, and AI agents.

Today’s episode builds on that conversation. We’re going to focus on the lasting value that managers — and especially great managers — bring to organizations and individual workers. And we’re going to look at compelling new data showing that matching human potential to opportunity is not something AI can easily automate. The future of leadership will require different skills — but managers remain absolutely essential.

Let’s begin with a bit of context. In many companies, management has historically been seen as a cost center. It’s the layer between the leadership and the workforce, helping to execute top-down strategy and ensure accountability.

But this framing is overdue for a refresh — especially in an AI-enhanced world. Because the truth is, great managers do so much more than delegate tasks or approve paid time off. They’re strategic enablers of human potential.

And recent research now suggests just how transformative a great manager can be.

The University of Chicago’s Becker Friedman Institute published a working paper, titled Making the Invisible Hand Visible: Managers and the Allocation of Workers to Jobs. Over a ten-year period, researchers tracked worker outcomes after transitioning from low-performing managers to what they call “high-flyer” managers — those in the top quartile of performance. The results showed that high-flyer managers did more than simply create incremental benefits. They were transformative.

Workers under high-flyer managers saw a forty percent increase in lateral job moves compared to those who stayed with lower-performing managers. This matters because lateral mobility is a key driver of skill development and long-term career growth. It’s often where hidden talent is unlocked, developed, and recognized.

What’s more, employees who worked with a high-performing manager also saw a thirteen percent salary increase over time. Many of the gains weren’t due to coaching, performance pressure, or incentives. Rather, they were driven by one key managerial action — better matching of people to roles.

In short, the best managers act as talent architects. They see beyond job titles and spot potential others may overlook. They move people to where they can thrive.

And in a world where business needs, technology, and skill sets are shifting rapidly, this kind of insight is increasingly important.

Now, let’s discuss where AI comes into play.

Yes, AI tools can identify skills gaps, recommend training modules, and match resumes to job descriptions. But can AI flag when someone on your team is quietly disengaging — even when their KPIs still look good on paper? Can it pick up on unspoken ambitions? Hidden strengths? Or can it detect the subtle shift in motivation that signals it’s time for a stretch assignment?

The answer, in short, is no. It can’t. At least not yet. And maybe not ever.

Because effective talent matching isn’t only about the data — it’s about context, nuance, and trust.

The University of Chicago working paper also found that high-performing managers spend approximately nineteen percent more time in one-on-one meetings. They don’t simply communicate more — they listen more. They gather soft data. They ask probing questions. They build rapport. And these seemingly “soft” activities can lead to measurable results — retention, advancement, and engagement.

The importance of managers to the employee experience is reinforced by broader workplace sentiment data. Glassdoor analyzed over two million employee reviews and found that individual contributor satisfaction consistently aligns more closely with how managers feel — not how senior leaders feel. In fact, when there’s a disconnect between manager and leader sentiment, employees tend to mirror their manager’s experience. Even in cases where executive ratings are high, if managers report low satisfaction, employees do too.

The influence of managers extends beyond morale. Glassdoor also found that manager sentiment significantly shapes employee ratings around work-life balance, culture and values, and inclusion. When managers are satisfied — even if leaders aren’t — employee satisfaction in these areas climbs substantially. In short, a manager’s experience trickles down into the individual worker’s experience. And this makes the managers’ role in shaping the employee journey impossible to ignore.

However, it can be easy to overlook the power of a good manager. Their influence often shows up quietly — in retention metrics, lateral promotions, or even the success of employees long after the manager has moved on.

And that’s another insight from the University of Chicago paper: The impact of a great manager often outlives the manager’s tenure at the company. The learning, the encouragement, the doors opened — they ripple outward. Years later, an employee may still benefit from the decisions an effective manager once made on their behalf.

All of this leads us to a crucial shift happening in how leadership is defined in the future.

The best managers do more than manage performance. They identify potential, they distribute opportunity, and they sculpt career trajectories.

AI can optimize workflows and highlight gaps. But it can’t — and shouldn’t — be responsible for the relationship-building and personal influence of true leaders.

As the workforce becomes more fluid and AI tools take on a greater share of routine tasks, leadership itself is being redefined. Across fast-moving organizations, there's a growing recognition that talent allocation — the ability to match people to the right roles at the right time — is a core leadership skill, not simply an operational detail.

The most effective leaders are those who can quickly identify emerging skill needs, uncover hidden or underutilized talent, and move people into roles where they can have the greatest impact. These capabilities are no longer optional — they’re what make organizations adaptive and resilient in a rapidly changing world of work. And when done effectively, talent allocation also benefits workers — by opening up new growth paths, increasing visibility and engagement, and creating opportunities that may have otherwise gone unnoticed.

So here’s the bottom line: AI is unlikely to entirely replace managers across the board. But it is reshaping what great management looks like.

The future belongs to managers who are curious about human potential, comfortable with ambiguity, skilled at matching people to opportunities, and willing to use AI as a co-pilot, not a competitor.

In this model, AI doesn’t take over the manager’s role. It amplifies it. A smart manager will use AI to crunch data on skills gaps or performance trends — then use their own expertise, judgment, and context when making decisions. They’ll use AI to handle the routine — so they can focus on the relational. They’ll use it to generate feedback drafts — then edit them to reflect nuance and empathy.

So what does this mean for you?

If you’re a manager, the expectations for your role are shifting. Your ability to match people to meaningful work, see potential others miss, and adapt quickly will define your effectiveness more than your ability to manage a workflow or run a status meeting.

If you’re a senior leader, start treating talent allocation and skill development like the strategic levers they are. Incentivize managers to uncover and activate the hidden talents in their team members. Build systems that make lateral moves just as celebrated as promotions. And remember — AI may give you better visibility into performance, but only managers can tell you how people feel about their work.

If you’re an employee, don’t underestimate the power of a good manager. If you’ve had one, you already know how much it matters. And if you haven’t, don’t settle. Advocate for the support and opportunity you need.

Let’s end the episode as we always do, with an action step you can implement immediately and a question to reflect on throughout the week.

If you’re a manager or business leader, here’s your action step: take inventory of your team’s current roles and capabilities — and pinpoint untapped potential. Identify at least one team member who could grow by taking on a new responsibility, a lateral move, or a stretch assignment. Use your next one-on-one to start that conversation and begin creating a path forward.

If you’re an individual contributor, look at your current work and ask yourself: where am I underutilized — and where could I add more value? Proactively raise one area of interest or growth in your next manager check-in, and explore how your role might be developed to better align with your strengths and aspirations.

And here’s your reflection question: How effectively are you — or your organization — allocating talent to maximize individual potential, unlock hidden strengths, and respond to shifting business needs with agility?

Talent allocation requires vision, empathy, and a long-term view. It’s about looking beyond what someone can do today and seeing what someone can become. 

Thank you for listening to Work Week. I’m Gabby Burlacu and if you found this episode helpful, I’d love for you to share it with a friend or leave a quick review. And make sure to subscribe to the show to stay updated on the latest trends impacting the future of work.