Artificial intelligence (AI) led to 38,579 layoffs in the United States in May, the highest monthly total since tracking began in 2023, and AI topped all other causes of layoffs for the third month in a row.
AI accounted for 40% of job cuts announced in May as employers accelerate role automation and reorganization around technology.
AI is to blame for all of the U.S. layoffs
This figure comes from Challenger, Gray & Christmas. According to the latest report, AI’s share of monthly cuts rose from 7% in January to 26% in April and 40% in May.
For the year, AI was cited in 87,714 layoffs, representing 22% of all 2026 layoffs. This total already exceeds the 54,836 cases attributed to this technology in all of 2025.
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Andy Challenger, the company’s chief revenue officer, noted that companies are grappling with and reorganizing around AI.
“AI has not yet led to the job destruction that some predicted. Like spreadsheets and email before it, the technology will eventually make workers more productive, but our data shows that companies are already working on it, citing AI-driven cuts more than any other reason. The open question is not whether AI will transform the workforce.”
Banks and fintechs join in the adoption of AI
That pressure now extends beyond Big Tech. Financial technology (FinTech) companies announced 5,731 job cuts in May, most of which mentioned AI in their announcements.
Banks are also restructuring based on the same logic. Standard Chartered plans to scale up automation and cut 7,800 back-office jobs by 2030.
Overall, the number of reductions in May totaled 97,006, the highest May since 2020 and the third consecutive month of increase. The technology sector led all sectors with 38,242 job cuts, remaining the sector with the largest job cuts this year.
Employers are cutting 397,755 jobs by 2026, a 43% decrease from the announced 696,309 jobs for the same period in 2025. That previous figure was inflated by deep federal layoffs, pushing the number into record territory.
