Early 2026: 80,000 tech workers laid off, half due to AI

In the first three months of 2026, 80,000 technology workers were laid off, with AI cited as responsible for roughly half of the job cuts, according to Nikkei Asia Review. The reported wave has rattled Silicon Valley and other global tech hubs, while industry insiders describe it as an early phase of a broader workforce overhaul as AI begins to take on more enterprise processes.

Layoff figures and the role of AI

RationalFX analysis estimates that 78,557 tech employees were cut between Jan 1 and Apr 1, 2026. The United States accounted for 76.7% of all layoffs in that period.

Nearly half of the layoffs globally—about 37,638 roles—were linked directly or indirectly to AI deployment and workflow automation. The figures point to heightened corporate expectations that machines will replace human labor, even before measurable productivity gains from AI are fully realized.

Industry perspective: expectations versus realized productivity

Babak Hodjat, AI Director at Cognizant, one of the world’s largest IT services providers, said the current wave of layoffs may not yet reflect the productivity improvements AI can deliver.

“The current wave of layoffs may not yet reflect the productivity gains from AI. He noted that layoffs are often driven by the expectation that AI will improve efficiency, rather than by actual improvements achieved.”

Hodjat added that AI can become a convenient scapegoat in financial and restructuring decisions.

“Sometimes AI becomes the scapegoat from a financial perspective. For example, when a company hires too aggressively or restructures, and all mistakes are blamed on AI,” Hodjat said.

He said it will take at least 6 to 12 months for companies to begin seeing real productivity gains from AI. Once those gains appear, he expects the workforce changes to enter a more decisive phase.

Cognizant’s response and business shift

Cognizant is described as pursuing self-disruption to remain competitive. While most of its revenue still comes from business process outsourcing (BPO), which grew 9% in 2025, the company is rapidly developing AI agents intended to replace traditional offshored tasks.

In its AI labs in San Francisco and Bengaluru, Cognizant is tuning large language models (LLMs) and deploying autonomous agents designed to operate independently. Hodjat said client demand is pushing IT services firms to integrate AI more deeply into delivery.

“We must do this because clients demand AI to be integrated more into IT services. The productivity expectations when we code for clients have changed completely,” Hodjat said.

“Last mile” enterprise requirements

The article notes that while “instant AI” solutions exist, they often do not meet the security and reliability requirements needed for enterprise use. This gap—described as the “last mile”—is presented as the area where IT services firms such as Cognizant are focusing to maintain their position in the AI-driven shift.

Source: Nikkei Asia Review.