The US tech sector lost 15,000 jobs in March even though the overall US economy saw 178,000 jobs gained across all sectors, according to data from multiple sources, released by Labor Department’s Bureau of Labor Statistics (BLS), pegged the unemployment rate for tech workers at 3.9%. That’s still below the national unemployment rate of 4.3%.
The March losses reflect a downward trend compared to the 7,100 jobs gained in February.
Most of the jobs lost were in the custom software services and systems design occupation category, which shed 13,200 positions. Overall, about 118,000 tech jobs were lost across IT and non-IT sectors..
in a shift it portrayed as moving toward the automation of work using AI. But many criticized Block for “AI-washing,” where companies use AI to justify downsizing.
AI has been cited as a reason for 54,836 layoffs so far in 2026, accounting for 5% of all jobs cut, higher than 3% in February, according to Challenger, Gray & Christmas.
AI is forcing a shift in workforce skills
Companies are investing in AI instead of human labor, and functions like AI coding are replacing human developers. “Other industries are testing the limits of this new technology, and while it can’t replace jobs completely, it is costing jobs,” Challenger Gray and Christmas said.
Multiple studies noted the emergence of a new AI-savvy workforce, with tech job listings reflecting that shift as companies gradually implement AI strategies.
“More organizations are seeking talent with the technical depth to support automation, data integrity, and scalable systems,” said Kye Mitchell, head of Experis North America.
The appetite for AI is also creating positions needed to build out digital and physical infrastructure, Mitchell said.
The BLS data shows the labor market is regaining its footing, though the job numbers may be telling only a partial story, said Ger Doyle, Regional President, North America, at ManpowerGroup.
The ongoing Middle East conflict could also affect jobs in non-tech sectors. “Deepening geopolitical risk and higher energy prices create real uncertainty about what comes next,” Doyle said.
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