The American tech job market is losing steam. Unemployment in IT has spiked again, now sitting at 5.5%, and much of the blame is landing on the rise of AI—particularly generative agents that are starting to replace entry-level roles.
For the fifth month in a row, IT unemployment is running higher than the national average. What used to be a thriving sector is now sounding alarms. Junior roles are vanishing. Recruiters are ghosting. The shift is real, and it’s getting personal for thousands in the industry.
Entry-Level Tech Jobs Are Becoming an Endangered Species
The numbers say a lot. But they don’t say everything.
A fresh report by IT consultancy firm Janco shows unemployment in the US tech workforce jumped from 4.6% in April to 5.5% in May. That’s the highest it’s been in more than a year. And what’s worse? It’s been creeping up every single month since January.
Here’s the kicker: entry-level and mid-tier jobs are bearing the brunt. AI, automation, and increasingly efficient code-completion tools have started chipping away at once-reliable job categories like QA testing, help desk support, and junior development.
One hiring manager from a Fortune 500 firm, speaking anonymously, said bluntly: “Why would I onboard a fresh grad when my product team just integrated an agent that can run 24/7 and doesn’t call in sick?”
That one sentence sums up a huge shift in how IT departments think.
AI’s Rising Curve, Human Job Count Falling
Let’s not pretend it’s all AI’s fault. But let’s also not pretend AI isn’t the headline act here.
Ever since ChatGPT, Claude, Gemini, and other large language models became common workplace tools, tech companies—especially the big ones—have been rethinking staffing models. And they’re doing it fast.
According to the Janco report, job listings for AI-related roles (including prompt engineering and LLM integration) have increased sharply. But these are highly specialized, often senior-level jobs.
Most regular folks in tech? They’re finding their old roles increasingly irrelevant.
In between the flashy headlines about AI breakthroughs, a quieter shift is happening: tasks that used to take hours can now be wrapped up in minutes. Debugging? Documentation? Initial code scaffolding? There’s a bot for that.
Here’s What’s Still Hiring
If you’re in tech and looking for work, some roles are still hot. But good luck if you’re not already deep into these fields:
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LLM and AI model training
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Blockchain system integration
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Omnichannel and cross-platform commerce design
Those were the three categories flagged by Janco as still growing in the US. And they’re not hiring in bulk. These aren’t dozens-of-resumes-a-day positions—they’re niche, demanding, and require years of experience or deep research exposure.
For context, here’s a snapshot comparing hiring interest in May 2025:
| Job Category | % Change (YoY) in Listings | Avg. Salary (USD) |
|---|---|---|
| LLM Integration Engineer | +18% | $162,000 |
| Blockchain System Architect | +11% | $139,500 |
| Omnichannel Commerce Specialist | +9% | $126,800 |
| Junior Frontend Developer | -24% | $76,200 |
| Technical Support Analyst | -28% | $63,500 |
Yes, some parts of tech are growing—but it’s a narrow field, and the ladder has fewer rungs than it did before.
A Tale of Two Markets
What’s really interesting is that the US job numbers come right on the heels of relatively upbeat news from the UK.
Last week, reports from the UK tech sector showed stable hiring activity and relatively flat unemployment, especially in mid-tier positions. Analysts credit slower AI adoption in British firms and stronger employee protections.
Back in the States? It’s far more Wild West. Companies are moving fast. Layoffs happen via email. And new hires are told to “learn AI tools” before orientation’s even over.
It’s creating what some insiders are calling a two-tier tech economy: a lean group of senior AI-literate engineers who build the future, and a much larger group scrambling to stay relevant.
Looking Ahead: Uncertainty Feels Like the New Normal
There’s no sugarcoating it. The vibe in the US tech job market is uneasy.
Some folks are retraining. Others are doubling down on contract gigs or going indie. Still others are considering career pivots entirely—into design, data analytics, or even outside tech.
Meanwhile, AI isn’t slowing down. If anything, it’s accelerating. Every major firm is pouring cash into tools that do more, faster, for less. And in those boardrooms, the question isn’t if AI can do the job. It’s when it will do it better.
But don’t count people out just yet.
Human intuition, creativity, and plain ol’ customer empathy—those still matter. At least for now. And while the tech job market may be shaking, it hasn’t collapsed. It’s shifting. And where it lands next? That’s still anyone’s guess.
