Tech hiring slows, unemployment rises, jobs report shows

Although the nation’s overall unemployment rate held steady in April, technology worker hiring slowed and unemployment rose markedly.

Tech sector companies reduced staffing by a net 7,000 positions in April, an analysis of data released today by the US Bureau of Labor Statistics (BLS) showed.

“Employers are no longer aggressively expanding their workforce, fewer individuals are leaving their jobs, and those who do are finding it challenging to re-enter the job market,” said Ger Doyle, U.S. Country Manager at employment firm ManpowerGroup. “This highlights a significant shift in labor market dynamics, where churn and confidence are low.”

Hiring gains in the tech services sector were not enough to offset job losses in tech manufacturing, telecommunications and cloud infrastructure, according to a report from tech industry association CompTIA.

Across the economy, tech employment fell by an estimated 214,000 jobs, pushing the sector’s unemployment rate up to 3.5% from 3.1% in March. “It was not a great month of data, but expected given the circumstances,” said Tim Herbert, CompTIA’s chief research officer. “Employer tech job postings continue to hold up, so [that’s] a possible sign that hiring will resume as companies find their bearings.”

CompTIA

Across all job sectors, employers added 177,000 jobs in April despite economic uncertainty around President Donald J. Trump’s international tariffs, BLS data showed. The overall unemployment rate remained unchanged from March at 4.2%.

“Our real-time data shows job openings down 11% year-over-year, signaling a cooling environment,” Doyle said.

Hiring remains slow as employers focus on talent retention and adopt a “wait-and-watch” approach, closely monitoring economic signals, Doyle said. While sectors like medical and executive management grow, concerns about future hiring and AI’s impact on roles persist, he said.

“While our data shows a 13% month-over-month decline in traditional software developer postings, this doesn’t tell the whole story. Developers are evolving into strategic technology orchestrators who harness AI to drive unprecedented business value,” said Kye Mitchell, head of tech employment firm Experis North America, a ManpowerGroup subsidiary.

The impact from AI on hiring was stark, as companies grapple with cleaning, organizing, and sharing data stores for potential use by the technology. Demand for database architects skyrocketed, leaping 2312%, Mitchell said. Jobs for statisticians also rose sharply (up 382%).

In today’s economy, IT leaders must invest in AI to deliver measurable outcomes, not just for the sake of technology, according to Mitchell. “Tech leaders must be incredibly precise about where they allocate resources. This isn’t about AI for AI’s sake; outcomes [must] justify the investment, even during uncertain times,” she said.

Among vertical industries, employment continued to trend up in healthcare, transportation and warehousing, financial activities, and social assistance. But federal government employment declined amid cuts by the Trump Administration and its unofficial Department of Government Efficiency (DOGE).

Employers continue to pursue skills-based hiring strategies. About one-half of all April tech job postings did not specify a need for a four-year academic degree, according to CompTIA.

Skills-based hiring has been on the rise for several years, as organizations seek to fill specific needs for big data analytics, programing (such as Rust), and AI prompt engineering. In fact, demand for generative AI (genAI) courses is surging, passing all other tech skills courses spanning fields from data science to cybersecurity, project management, and marketing.

GenAI projects will move from pilot phase to production for many companies this year, which means workers are likely to be affected in ways never before imagined, according to Sarah Hoffman, director of AI research at AlphaSense.

“As AI automates more processes, the role of workers will shift,” Hoffman said in an earlier interview. “Jobs focused on repetitive tasks may decline, but new roles will emerge, requiring employees to focus on overseeing AI systems, handling exceptions, and performing creative or strategic functions that AI cannot easily replicate. The future workforce will likely collaborate more closely with AI tools.”

When considering new hires, 80% of corporate executives are expected to prioritize skills over degrees, with half planning to boost freelance hiring this year to fill in for a gap in AI and other skills, according to a recent study from freelancing platform Upwork.

The top 10 highest-paid skills in tech can help workers earn up to 47% more — and the top skill among them is genAI, according to employment website Indeed and other sources. “Let’s be honest, the job opportunities in the AI field for AI scientists has gone up massively,” said Julie Teigland, global vice chair for alliances and ecosystems at Ernst & Young. “There is a huge skills gap in terms of the number of people that can do that and that is not changing. Those are still in massive demand.

“Everywhere else we can talk about what jobs are changing and where the future is, but AI scientists and data scientists continue to be the top two in terms of what we’re looking for,” she said.

Geographically, when it comes to tech job postings, California topped all states in April with 26,280, up 1,037 from March. Texas, Virginia, and New York followed in total postings, while Arizona, West Virginia, and Maryland saw the largest month-over-month percentage gains, CompTIA data showed.