U.S. IT Job Market Shrinks—AI Taking Over Entry-Level Roles, Leaving Thousands Unemployed!

According to a new report by Janco Associates, many Information Technology (IT) experts in the United States are unemployed because the job market has shrunk by 22,300 positions last year. This is the second year of decline of IT jobs, with about 70,900 IT jobs being eliminated in the past two years. There has only been a 1.87% increase in median salaries of IT pros, amidst the inflation rate being 2.9%. The report was based on official data by the Bureau of Labor Statistics, which found that there was a loss of 5,700 positions in the IT job market in December 2024 alone. Security professionals are the most in-demand IT position right now.

In 2023, there was a loss of 48,600 IT workers in the IT job market which shows that decline was somewhat slower in 2024. In the US, the national average for unemployment rate is 4.1% while the unemployment rate among IT professionals is 3.9% with more than 4.16 million Americans working in IT fields.

Another report by Layoffs.fyi found out that 2,000 IT companies laid off 270,000 employees in 2023 while 152,000 employees were laid off by 546 tech companies (Tesla, Facebook, Microsoft, Google, Tesla, Amazon, Intel and others) in 2024.

The estimates by Janco shows that the IT job market is going to shrink in the next upcoming months, while most small to mid-sized companies are hiring new individuals and providing more jobs. The large enterprises are more focused on AI adoption and are planning to replace low skill workers with AI for increased productivity. AI is increasingly replacing entry-level positions in the IT sector. The AI experts, technology programmers, security professionals and Internet Processing IT professionals are the only ones who were being actively sought. 63 of the companies laid off 6,300 employees in the beginning of 2023 and 1,356 of them were laid off in 2024.

There was a slight increase in mean compensation for IT professionals in 2024, with $104,517 earned on average. Trading Economics report that wages have increased 5.8% in the US in November 2024. There was a 28% increase in wages of IT professionals, from 2015 ($81,583) to 2025 ($104,517). The salary was mostly due to a 34.4% CPI increase in the US between December 2014 and December 2024.

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by Arooj Ahmed via Digital Information World