US tech companies have laid off nearly 140,000 employees since the start of 2026, a trend persisting despite record AI spending. These cuts represent over a third of US layoffs in the period, with Amazon, Oracle, Meta, and Microsoft accounting for approximately 50,000. This wave of job reductions began after the Covid-19 pandemic, when tech firms expanded rapidly based on anticipated demand for digital services.

Despite these layoffs, the broader US job market remains resilient, with unemployment at a low 4.2%. Major tech players like the Big Four hyperscalers (Amazon, Alphabet, Meta, Microsoft) are investing heavily in data center infrastructure, with plans for $725bn in capital expenditure this year. Oracle, for instance, aims to invest $70bn to support clients like OpenAI.

Analysts suggest these cuts are a response to earlier overhiring and a necessary step to fund AI investments. Some companies, like Microsoft and Block, have also cited AI-driven productivity gains as a reason for workforce reductions. However, academics question this rationale, suggesting it's a pretext for executives to correct past hiring mistakes. While established tech giants trim staff, AI-focused startups like Anthropic and OpenAI are actively expanding their workforces.