Layoffs Hit 2-Year Low as AI Job Fears Persist in 2026

A Confusing Moment for the Job Market

Layoffs across the U.S. economy have fallen to their lowest level in roughly two years, even as anxiety about artificial intelligence's effect on employment continues to dominate public conversation 1. Economists note that workers who do lose their jobs are being reabsorbed into the workforce almost as quickly as new positions open up, suggesting the labor market remains resilient despite headlines warning of an AI-driven "job apocalypse" 13.

That tension — broad macro data showing stability alongside a steady drumbeat of company-specific cuts tied explicitly to AI — is the defining feature of the current moment. Vanguard's chief economist has pushed back hard on the idea of an imminent white-collar wipeout, arguing that fears of mass AI-driven displacement are "way overdone" and that most office functions are not close to being fully automated away 2. Yet surveys show the sentiment gap is real: less than half of American college students say they feel positive about their job prospects, and many are already adapting by using AI tools themselves to stay competitive rather than be replaced by them 3.

Company-Level Cuts Tell a Mixed Story

Even as national layoff totals decline, individual companies continue to announce AI-linked reductions. Visa cut about 70 jobs at its Bellevue office as part of a global reduction of 2,600 positions, with the company framing the moves as part of an efficiency push enabled by AI adoption 6. Zillow similarly eliminated more than 500 positions, including 91 in Seattle, as it leans further into AI-driven operations 8. Reports also describe a dramatic case involving a company referred to as Quantum Dynamics, which reportedly terminated 15,000 employees after attributing the cuts directly to AI systems that had automated entire departments — a scale and explicitness that stands apart from most other disclosed layoffs 4. Meta's own workforce reductions have likewise been scrutinized, though commentary suggests the reality behind those cuts is more nuanced than a simple narrative of AI replacing workers 5.

Productivity Gains Show Up in Earnings, Too

Beyond layoffs, AI's labor-market footprint is increasingly visible in corporate earnings commentary. Cars.com highlighted the impact of its AI assistant, "Carson," alongside marketplace growth and margin guidance in its second-quarter earnings call, pointing to AI as a driver of operational performance rather than purely a cost-cutting tool 7. Separately, an Apollo Global Management study using real-world adoption data examined which segments of the U.S. labor market show the highest exposure to AI-driven change, offering a more data-grounded lens on where disruption is concentrated 9.

What It Means

Taken together, the coverage suggests no single, unified story: aggregate layoff figures point to a healthy labor market, while sector- and company-specific announcements show AI reshaping staffing decisions at firms like Visa, Zillow, and others. The divergence between economists' reassurances and workers' — especially students' — anxiety indicates that the labor market's transition through AI adoption is uneven, with productivity gains and job losses appearing side by side rather than resolving cleanly in either direction.