Goldman Sachs is out with a blunt take for tech workers being displaced by AI: Expect a lengthy search to secure a job that will probably pay less than your previous gig.
“Workers displaced from technology-disrupted occupations face more difficult short-run transitions back into employment,” Goldman Sachs strategist Pierfrancesco Mei wrote in a new note on Monday. “They take approximately one month longer to find a new job and suffer real earnings losses of more than 3% upon reemployment, compared with negligible losses for workers displaced from more stable occupations.”
He added, “A key mechanism behind these worse outcomes is occupational downgrading. Workers displaced by technology are more likely to move into more routine occupations requiring fewer analytical and interpersonal skills, likely because the same technological shifts that eliminated their positions also eroded the value of their existing skills.”
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The growing impact of AI is already evident in massive layoffs at Block (XYZ), Amazon (AMZN), Oracle (ORCL), and Meta (META) this year.
Block’s AI-related layoffs were particularly painful, as the workforce was cut by a whopping 40%.
“I would encourage everybody, including my fellow CFOs, to just be curious and using the tools,” Block CFO Amrita Ahuja told Yahoo Finance about the decision. “You often don’t get the ‘aha moment’ until you realize you’ve automated a piece of your work — something that might have taken days before can now take hours or less.”
Oracle’s layoffs were nothing to sneeze at either.
With billionaire founder Larry Ellison still pulling the strings, it reportedly laid off up to 30,000 workers across the US, Mexico, and other countries on April 1.
Over 52,000 US tech employees were laid off within the first three months of 2026, according to an analysis done by Challenger, Gray and Christmas. A good portion of these layoffs were tied to AI adoption.
The tech industry announced 18,720 job cuts in March, an increase of 40% year over year. It’s the highest year-to-date total for the sector since 2023, when 102,391 job cuts were recorded.
More tech layoffs are likely to come in 2026, Challenger, Gray and Christmas warned.
“Companies are shifting budgets toward AI investments at the expense of jobs,” said Andy Challenger, chief revenue officer for Challenger, Gray & Christmas. “The actual replacing of roles can be seen in technology companies, where AI can replace coding functions. Other industries are testing the limits of this new technology, and while it can’t replace jobs completely, it is costing jobs.”
