Artificial intelligence has been identified as the primary cause of job reductions in the United States this year, surpassing the total layoffs from the previous two years combined. A report by outplacement firm Challenger, Gray & Christmas revealed that over 97,000 job cuts were announced in May 2026, the highest for May since the start of the Covid-19 pandemic in 2020.
The report indicated a consistent increase in layoffs over the past three months, with numbers escalating from 48,307 in February to 60,620 in March, 83,387 in April, and exceeding 97,000 in May. Nearly 40% of all announced layoffs in May were attributed to artificial intelligence, emphasizing the growing impact of automation on employment.
Companies reported 38,579 job cuts in May alone due to automation and AI adoption, the highest monthly figure since tracking began in 2023. This brought the total count of AI-related job cuts in 2026 to 87,714, already surpassing the combined total from the previous two years.
Andy Challenger, chief revenue officer of Challenger, Gray & Christmas, highlighted that AI is now the primary reason cited by companies for job cuts, underscoring the increasing role of automation in workforce restructuring. The technology sector was the most affected, with US-based technology companies announcing 38,242 job cuts in May, the highest monthly total since August 2024.
On a year-to-date basis, layoffs in the technology sector have surged by 66% to 123,000, making it the hardest-hit industry in the US job market. The report also noted that the technology sector has experienced nearly three times as many job cuts compared to the next most affected industry.
