In the USA, the reason of artificial intelligence prominently stood out in companies' layoff decisions. According to the new report by Challenger, Gray & Christmas, which provides layoff and placement services, 40% of the 97,006 layoffs announced in May were associated with artificial intelligence.
This was the highest monthly level seen since the institution started tracking artificial intelligence as a reason for layoffs in 2023. According to the report, so far in 2026, 87,714 cuts have been linked to artificial intelligence, already surpassing the 54,836 recorded in 2025.
What reasons did employers cite?
Besides artificial intelligence, the most frequently attributed reasons for layoffs in the report included market and economic conditions. Under this heading, 69,645 cuts were counted.
Closures followed with 66,733 cuts. The number of layoffs announced due to restructuring was reported as 52,249.
Technology sector remains at the forefront
Challenger, Gray & Christmas also reported that May was the highest month for layoffs seen since 2020. In 2020, during the peak period of the global COVID-19 pandemic, 397,016 layoffs were announced.
The report also noted that the technology sector continues to hold a clear lead in layoffs. It emphasized that the sector is the leader by a wide margin in total cuts.
"AI-driven job loss" debate continues
Andy Challenger, the company's work and labor expert and also chief revenue officer, said that artificial intelligence has not yet caused as large a job disruption as some circles predicted. However, Challenger stated that companies are increasingly citing artificial intelligence as a reason in their decisions.
Andy Challenger expressed that technology could ultimately make employees more productive, but companies are already using it more as a reason for layoffs. Nevertheless, the debate about the impact of artificial intelligence on job losses continues.
OpenAI CEO Sam Altman had said that companies are "AI washing" by attributing layoffs to artificial intelligence when there are other commercial reasons. Apollo Global Management Chief Economist Torsten Sløk wrote last week, referring to the ADP National Employment Report, that he saw "zero evidence" of job loss due to artificial intelligence.
Recent data shows that artificial intelligence is emerging not as the sole ultimate cause in the labor market but increasingly as a reason used within companies' restructuring language.
