AI jobs apocalypse reaches a new high

Tech evangelists leading the charge for AI adoption seem to have finally figured out that telling the world that artificial intelligence is coming for everyone's jobs is bad PR. But the latest data suggests that the about-face may be too late.

Last week, OpenAI CEO Sam Altman became the latest AI exec to walk back his previous comments, telling the Commonwealth Bank of Australia conference in Sydney that his earlier predictions about the social and economic implications were "pretty wrong."

"I'm delighted to be wrong about this. I thought there would have been more impact on entry-level white-collar jobs being eliminated by now than has actually happened," Altman said, according to Reuters. "I now think I understand more about why it hasn't, and I'm obviously grateful, but that is an area where my intuitions were just off."

His more humble tone is a sharp departure from the hubris he has shown repeatedly in the past when he has said things like "I'm happy to say that I am convinced that the job destruction in the next couple of decades is going to be massive," even going as far as to say that "my job is to help people destroy jobs."

Whether he has truly had a change of heart or has just seen polling on shifting American attitudes toward AI is up for debate, but the latest data from Challenger, Gray & Christmas suggests his initial predictions are starting to come true.

Andriy Onufriyenko / Getty Images

AI adoption drives May job losses to Covid levels

U.S.-based employers announced more than 97,000 job cuts in May, a 16% increase from the more than 83,000 they cut the month prior and 3% higher than last year's total, according to the latest data from Challenger, Gray & Christmas viewed by TheStreet.

The May 2026 total was the highest for the month since 2020, when the Covid pandemic forced employers to cut nearly 400,000.

The firm says it has seen "a jump in bankruptcy-related losses, which tells me companies are restructuring aggressively as they reposition for an AI-driven economy," according to Andy Challenger, labor and workplace expert and Chief Revenue Officer of Challenger, Gray & Christmas.

The tech sector was responsible for more than a third of the job cuts, with companies announcing more than 38,000 job cuts in the month, the highest total since August 2024.

Meta, the parent company of Facebook, led the way, laying off 8,000 amid the company's own shift towards an AI future.

For the year, the tech sector has announced 123,653 job cuts, a 66% increase from the 74,716 announced through the first five months of 2025. Tech is the leading job cutter "by a wide margin," according to Challenger.

"The labor market is being reshaped by technology in real time. AI is now the leading reason companies give for cutting jobs, and the primary industry citing it is Technology. Technology, already the year's biggest job cutter, saw its steepest month of cuts since early 2023, even as it remains the sector with the most hiring plans this year," said Challenger.

"AI isn't yet the jobpocalypse some predicted. Like spreadsheets and email before it, the technology will ultimately make workers more productive, but our data shows companies are already acting on it, citing AI for more cuts than any other reason. The open question isn't whether AI changes the workforce, but how fast."

Employers blame AI for job cuts

Employers aren't always truthful about the reasons for job cuts. Sometimes they blame one thing for the attrition when other causes may be more pressing. But whether they are being completely truthful or not, most are blaming AI for job cuts.

AI led all reasons for job cuts in Challenger's data for the third consecutive month, but the 38,579 AI-related job cuts in May were the highest monthly total ever recorded for the reason since the firm began tracking it in 2023. AI accounted for 40% of all job cuts announced in May, up from just 7% in January, 25% in March and 26% in April.

So far in 2026, employers have cited AI in 87,714 job cuts, or 22% of total job cuts. That total is already well ahead of the 54,836 that were attributed to the reason all last year.

So even though Sam Altman is having a change of heart, he may have just been ahead of the curve.

But it's not all doom and gloom, especially in the tech sector. While May's job cuts were deepest in tech, the industry also led all others in hires. Technology led May hiring by a large margin with 11,250 announced positions. Electronics was the next-largest hirer, adding just 3,158 jobs.

"People are like 'oh you could have saved the world a lot of fear mongering and a lot of doom and gloom,' but at the time I was like 'I see this is a real risk we should probably ​talk about it' and it still may," Altman said.

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This story was originally published June 5, 2026 at 8:07 PM.