Tech Layoffs Hit 113,000 in 2026 as AI Capex Reaches $725B
What Happened
Layoff data through mid-May shows 113,000 tech workers cut across 179 companies — about 825 per day. April alone saw 83,387 announced cuts, up 38% from March, with AI cited as the direct driver for 21,490. Meanwhile Google, Amazon, Microsoft, and Meta are increasing AI capex 77% year over year to $725 billion combined.
My Take
This is not a labor story, it is a balance sheet story. The capex-to-payroll ratio is the new strategic metric, and boards have decided depreciating GPUs are more valuable than salaried engineers. The uncomfortable truth: most of those engineers were doing work AI cannot yet replace, but the AI investment thesis demands the cost cuts now to justify the spending. Expect a snap-back hire in 2027 when productivity numbers disappoint — at which point the laid-off cohort will be the consultants charging triple.
Read Original Source