Employers blamed AI for nearly 40% of May's cuts — a share that’s kept climbing since Challenger began tracking it in 2023.
With Corporate America finding plenty of ways to describe its AI-driven reinvention this year — from preparing for the "agentic era,” to building businesses with “humans around the edge” — last month brought yet another unmistakable sign that AI has become the go-to explanation for layoffs, according to new data from Challenger, Gray & Christmas.
In May, US employers announced 97,006 job cuts, the highest tally for the month since the pandemic spring of 2020. Artificial intelligence was cited ahead of all other job-cut reasons for the third month running, with 38,579 cuts attributed to the technology — nearly 40% of the total and the highest single-month figure since Challenger began tracking it in 2023.
AI has now been linked to more than 87,700 cuts through May, easily blowing past the ~54,800 attributed to it in all of 2025 — a figure that had already more than **quadrupled **from 2024 and risen roughly 13x from 2023. The technology has so far made up more than one-fifth of all announced job cuts in the US, up from just 0.6% in 2023.
Of course, that doesn’t mean AI is actually single-handedly replacing all those workers. A growing body of analysis has questioned whether companies are, in fact, using the technology as a more investor-friendly shorthand for cuts actually driven by more familiar pressures, like cost-cutting, restructuring, or simply slower hiring.
The anxiety is getting harder to dismiss, though. This week, Anthropic pledged **$200 million **toward studying AI’s economic impact, as CEO Dario Amodei warned in a new essay of the “decent possibility” of "significant enduring job loss” caused by AI.
Go deeper: AI is becoming a go-to reason for layoffs — but is it actually replacing workers?