Young professionals or students collaborating in a bright, contemporary co-working environment, displaying teamwork and productivity.
The AI boom in Corporate America over the last five years has hit a fever pitch, becoming ubiquitous across nearly every industry. LLMs have improved at lightning speed, triggering massive layoffs across the tech sector. California and Washington, two states where technology startups and innovation are central to the economy, have seen tens of thousands of layoffs. California has led the charge with over 73,000 tech job layoffs in 2025 alone.
Tech workers who lost their job amid rapid AI adoption ask, “Where can I get hired now?”, but perhaps the better question is, “Who would pay for the knowledge I possess?”
Nuance Across The Tech Layoffs
While some vulnerable jobs have been lost to AI, we should be careful not to blame its adoption as the primary cause of the massive layoffs. The state of California has launched an AI-Unemployment tracker to monitor how many jobs are being displaced by AI. Ben Hyman, Senior Researcher at California’s policy lab says: “Right now, we are not seeing evidence of large-scale AI-related layoffs in California’s labor market, but we do see patterns in certain regions like the Bay Area, in certain tech-heavy sectors and highly AI-exposed college-educated workers.”
So while there are attributable job losses, it would be a sweeping generalization to claim most tech layoffs are due to AI-related adoption; nevertheless, tens of thousands of tech layoffs are happening across the U.S., and employees are trying to figure out next steps.
For the last few years there have been some confounding complications to highly educated, talented white collar tech workers when it comes to reestablishing employment.
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Something Unusual is Happening To Out of Work Tech Workers
This cohort has traditionally been able to find work relatively easily. However, an Aug. 3 San Francisco Fed Economics letter found that prospects for prime-aged workers to find employment have dramatically decreased in recent years; most noticeably, college-educated workers experienced a 30% decline in job-finding rates from January 2023 to January 2026.
That study also found that structural forces could explain why prime-age working adults are having a hard time finding jobs right now.
When we consider structural changes, we have to look at how shifts in operating models are affecting traditionally qualified tech workers. Only 1% of IT leaders surveyed by Deloitte reported that no major operating model changes were underway, while 78% of tech leaders anticipate broad, targeted, or transformational integration of AI agents into architecture workflows over the next five years, according to a 2026 trend report by Deloitte Insights.
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