US tech layoffs surge in May, AI cited as top reason
US-based technology employers announced 38,242 job cuts in May, the highest monthly total since August 2024, according to Challenger Gray data. AI was the most cited reason for the third consecutive month, with 38,579 cuts attributed to AI in May alone.
Tech sector layoffs in the US reached a new high in May, with 38,242 job cuts announced — the largest monthly figure since August 2024, per Challenger Gray data. Year-to-date, tech sector job cuts rose 66% year-over-year to 123,653, the highest among all sectors and more than three times the next closest sector (transportation).
Artificial intelligence continues to reshape the labor market. For the third straight month, AI was the most cited reason for job cuts, with 38,579 cuts directly attributed to AI in May alone — the highest since Challenger began tracking this metric in 2023. That accounts for 40% of all layoffs announced in May, up sharply from just 7% in January.
Year-to-date, AI has been cited in 87,714 job cuts (22% of total), already surpassing the 54,836 recorded in all of 2025 and 12,742 in 2024.
Source: The Kobeissi Letter