Tech Layoffs Mean Longer Job Hunts and Pay Cuts, Goldman Sachs Warns
Technology workers displaced by artificial intelligence layoffs face extended unemployment and earnings losses exceeding 3%, according to research by Goldman Sachs strategist Pierfrancesco Mei. Affected workers take roughly one month longer to find new jobs than those in other sectors.
The analysis also documents occupational downgrading: displaced employees often move into routine roles requiring fewer analytical and interpersonal skills. The same AI advances eliminating jobs are simultaneously reducing the market value of existing technical expertise.
Scale of Current Layoffs
The disruption is already widespread. Block cut 40% of its workforce in AI-related reductions. Oracle laid off up to 30,000 employees across the United States, Mexico, and other countries on April 1. Meta has also reduced staff as part of wider restructuring.
Over 52,000 US tech employees were laid off in the first quarter of 2026, according to Challenger, Gray and Christmas analysis. March alone accounted for 18,720 technology job cuts - a 40% increase year-on-year and the highest first-quarter total since 2023, when 102,391 technology roles were eliminated.
Budget Shifts Toward AI Investment
Companies are redirecting resources from human resources toward artificial intelligence systems. Andy Challenger, chief revenue officer at Challenger, Gray and Christmas, said that while AI cannot replace all roles, it is reducing demand for coding and other technical functions in technology firms.
Even a 3% earnings loss accumulates significantly over time, creating sustained financial strain for workers transitioning to lower-skilled positions or enduring extended job searches.
What HR Leaders Need to Know
Technology workers face steeper reemployment challenges than those in other industries. Goldman Sachs recommends that displaced workers acquire new skills and understand emerging tools to maintain employability.
Jamie Dimon, Chief Executive Officer of JPMorgan Chase, acknowledged in his annual shareholder letter that artificial intelligence is eliminating some roles while creating others in cybersecurity and AI itself. The impact on the workforce remains uneven.
For HR professionals managing workforce transitions, this data underscores the need for proactive reskilling programs and realistic guidance about the job market. Workers need concrete support to navigate occupational shifts, not just severance packages.
Learn more about AI for Human Resources to understand how to support displaced workers and manage organizational restructuring effectively.
Your membership also unlocks:
