Job cuts in U.S: Lay offs total over 97,000 in May, highest in six years. Check what is disrupting jobs market

Job cuts and lay offs in the U.S. totaled more than 97,000 in May. This has been the highest for month of May since 2020, according to findings by Challenger, Gray & Christmas. The survey claimed that artificial intelligence was the numero uno reason behind employees losing jobs three months in a row.

Meanwhile, the Institute for Supply Management survey on ​Wednesday noted services sector employment remained subdued, with the ISM saying companies were reporting hiring freezes or were not backfilling vacated positions.

The strength was at odds with the Beige Book report, which said "most districts described a low-hire, low-fire environment." It ​also noted "hiring remained selective and primarily ⁠focused on critical roles or attrition replacement."



Job Cuts in U.S


The U.S. job market has recently witnessed a significant increase in workforce reductions, particularly within the technology industry. According to a report released by Challenger, Gray & Christmas, U.S.-based employers announced 97,006 job cuts in May alone. This figure highlights the growing challenges many businesses are facing amid economic uncertainty, changing market demands, and evolving business strategies.

Among all industries, the technology sector remained the leading contributor to job reductions. In May, technology companies announced 38,242 layoffs, accounting for a substantial share of the total job cuts reported during the month. These layoffs reflect the pressures faced by many tech firms as they adapt to shifting economic conditions, increased competition, and rapid technological advancements.

The trend becomes even more concerning when viewed over a longer period. Since the beginning of the year, technology companies have announced 123,653 job cuts. This represents a dramatic increase of 66 per cent compared to the same period in 2025. Such a sharp rise suggests that the sector is undergoing a major transformation, with companies reassessing their workforce requirements and operational priorities.

Several factors may be contributing to these layoffs. Businesses are increasingly focusing on cost reduction, efficiency improvements, and the integration of emerging technologies such as artificial intelligence and automation. While these innovations can improve productivity, they may also reduce the demand for certain roles, leading to workforce restructuring.

The growing number of layoffs serves as a reminder that even industries known for innovation and growth are not immune to economic challenges. As companies continue to adjust their strategies, employees may need to enhance their skills and remain adaptable to changing workplace demands. The future of the job market will likely depend on how organizations balance technological progress with workforce development and employment stability.