AI-Linked Job Cuts Surge In US

Tech is the hardest hit sector.

More than 10,000 of the positions cut in July are directly attributed to AI adoption, according to a report.

Artificial intelligence is emerging as a major driver of job losses in the United States, with more than 10,000 positions cut in July directly attributed to AI adoption, according to the latest report from employment consultancy Challenger, Gray & Christmas.

In total, U.S. employers announced 62,075 job cuts in July, a 29 percent increase in June and 140 percent higher than July 2024. Nearly half of these cuts (49 percent) were linked to AI and other technological updates. The report describes the figures as “well above average for this month since the pandemic” and among the highest July totals in the past decade. For comparison, the average July job cuts from 2021–2024 were 23,584 and the broader decade’s average was 60,398.

The 10,000 AI-related job losses form part of a wider wave of 20,219 additional cuts attributed to “technological updates” such as automation and new software workflows, which Challenger Gray says indicates “a significant acceleration in AI-related restructuring.”

“AI was cited for over 10,000 cuts last month,” says Andrew Challenger, senior vice president and labor expert at Challenger, Gray & Christmas. “We are seeing the Federal budget cuts implemented by DOGE impact non-profits and healthcare in addition to the government.”

Technology Sector Hit Hard

The technology sector has been the hardest hit in private industry, with 89,251 job cuts year-to-date, a 36 percent rise from last year. Challenger Gray links this to both AI’s disruptive impact and ongoing work visa uncertainty. Retail is also under pressure, with 80,487 layoffs in 2025 so far, up 249 percent year-on-year, as companies adopt automation alongside other cost-cutting measures.

Challenger Gray’s report underlines the scale of technology-driven labor disruption. Technology hiring plans remain weak, with only 5,510 positions announced so far in 2025, a 58 percent year-on-year decline.

This article originally appeared on our sister site Computing.