U.S. Tech Employers Cite AI for Record 38,579 Job Cuts in May as Sector Leads All Industries

-based technology employers announced 38,242 job cuts in May, the highest monthly total since August 2024, according to data compiled by Challenger Gray. Year-to-date tech sector job cuts reached 123,653 in 2026, a 66 percent increase from the same period in 2025.

The figure is the largest among all sectors tracked and three times larger than cuts recorded in the transportation sector, the next closest industry.

AI was listed as the most cited reason for job reductions for the third consecutive month. Employers attributed 38,579 cuts to AI in May, the highest monthly total since Challenger Gray began tracking the category in 2023. AI-related cuts accounted for 40 percent of all layoffs announced in May, up from 7 percent in January 2026.

Through the first five months of the year, AI has been cited in 87,714 job cuts, representing 22 percent of the total. The 87,714 AI-cited cuts already exceed the 54,836 recorded for all of 2025 and the 12,742 recorded for all of 2024.