Tech Insiders Warn of Massive Layoffs Ahead — Here’s How to Prepare
Over the past few weeks, CTOL.digital’s editorial inbox has been flooded with insider emails hinting at a storm brewing across the tech world. According to these sources, large-scale layoffs are expected to hit software engineering and other tech-related roles—like product management and tech sales in many major companies—by late 2025 and into early 2026. If you’re in the industry and in these roles, now’s the time to seriously buckle up and get ready.
How to Prepare for the Most Brutal Wave of Software Engineer Layoffs Yet
The software job market is transforming faster than anyone expected. AI automation, tightening economic pressures, and sweeping organizational changes have kicked off one of the largest employment shifts in tech history. In 2025 alone, more than 112,000 tech workers lost their jobs. And if early data is any sign, 2026 may be even rougher. So, let’s dig into what’s happening—and how you can stay ahead of the fallout.
The Hard Numbers Paint a Bleak Picture
Layoffs are everywhere. Amazon plans to cut roughly 30,000 positions. Microsoft already removed 9,000. Meta trimmed 600 AI-focused roles. Salesforce downsized its customer support staff from 9,000 to 5,000—citing AI efficiency gains. In India, TCS let go of nearly 20,000 workers in just one quarter, its biggest reduction ever. Some analysts predict that up to half a million IT jobs in India could vanish over the next two years.
A Stanford study adds more cause for concern: employment for young software developers aged 22 to 25 has plunged by nearly 20% since late 2022. Entry-level workers in AI-exposed jobs saw a 13% decline. In plain terms, junior roles are drying up. The entry pipeline that once fed the tech industry is being hollowed out faster than companies can refill it.
Why This Layoff Cycle Is Unlike Any Before
This isn’t your typical tech downturn. It’s not just about market corrections—it’s a fundamental restructuring of how companies operate. Three key trends are driving the shift.
1. AI Is Boosting Productivity—But Shrinking Teams Salesforce CEO Marc Benioff made waves when he said the company wouldn’t hire a single new software engineer in 2025. Why? AI tools boosted productivity by more than 30%. Microsoft and Google report that roughly 25–30% of their code now comes from AI. One senior engineer can now do the work of several juniors. When machines amplify output without creating new demand, companies inevitably need fewer people.
2. Economic Pressures Reward Cost-Cutting Over Growth Tech job postings have dropped 90% from their 2022 levels. In India, open roles plunged by a staggering 98%. Wall Street’s message to tech CEOs is clear: cut costs, not corners. Automation allows companies to maintain profits while trimming expensive engineering headcount. The result? Fewer jobs, especially for those outside high-impact or AI-aligned teams.
3. The Collapse of Entry-Level Hiring Between 2022 and 2024, listings for junior developer positions fell 60%. Computer science graduates now face unemployment rates as high as 7.5%—among the worst of any degree. Google and Meta are hiring roughly half as many new grads as they did in 2021, and Klarna froze all developer hiring entirely. The traditional “ladder” for new engineers? It’s missing a few rungs.
Who’s Most at Risk
Not everyone in tech faces equal danger. Some roles are clearly more vulnerable.
Entry-level and junior developers are first in line. Their routine coding work is exactly what AI tools can now handle with ease. Mid-level engineers without specialized expertise also face high exposure—especially those who mainly follow straightforward specs. In fact, nearly 60% of companies planning 2026 layoffs say they’ll target staff lacking AI-related skills.
High-salaried employees in non-critical roles are also in the crosshairs. When executives look to balance budgets, expensive positions often go first—particularly when AI tools show that fewer people can get the same job done.
Then there are roles on the chopping block due to automation: DevOps engineers (with up to 70% of tasks projected to be automatable by 2026), manual QA testers, entry-level data analysts, and lower-tier IT support. Even customer service reps, once thought untouchable, are at risk—three-quarters of developers now use AI assistants that automate much of their work.
The Roles That Still Hold Strong
It’s not all doom and gloom. Some positions are seeing explosive demand.
AI and Machine Learning Engineers are leading the charge. Job listings for ML roles jumped 40% from 2024 to 2025—the fastest rise of any category—and these specialists command salaries well into the six figures, often between $158,000 and $350,000 or more.
Cybersecurity Specialists are another bright spot. Even after some pandemic-era overhiring, there’s still a global shortage of more than four million cybersecurity pros. As AI systems multiply, so do security threats—problems that only humans can truly understand and mitigate.
And Senior Engineers with Deep Domain Knowledge continue to thrive. Companies are hunting for professionals who can solve tough architectural problems, understand business goals, and guide teams. In other words, people who think beyond code.
How to Protect Your Career
The tech world is shifting fast, but you can still play offense instead of defense. Here’s how.
1. Learn AI Tools—Now Resisting AI is like refusing to learn the internet in the ’90s—it’s a losing battle. Gartner predicts that 80% of engineers will need to upskill in AI just to stay relevant. Get familiar with GitHub Copilot, Cursor, Claude Code, Windsurf, and similar tools. Don’t just use them—master them. Learn how to validate, debug, and merge AI-generated code. That’s the new baseline skill set.
2. Build Deep Expertise and Stay Flexible Specialize in high-demand fields like AI/ML, cloud architecture, cybersecurity, or niche industries such as healthcare and finance. At the same time, be ready to pivot. The best engineers aren’t just experts—they’re adaptable problem-solvers who can shift gears as the market evolves.
3. Sharpen the Human Edge AI can write code, but it can’t think like you do. Strengthen your communication, creativity, and critical thinking. These “soft” skills are quickly becoming the hardest to find—and the most valuable. Employers rate them above 90% in importance.
4. Build a Financial Safety Net If layoffs hit, savings equal freedom. Aim to stash away six to twelve months’ worth of expenses. That cushion gives you time to breathe, reassess, and choose your next move without desperation clouding your judgment.
5. Network Like Your Job Depends On It—Because It Might Connections often open doors that cold applications never will. Attend meetups, join open-source projects, and keep in touch with former colleagues. When opportunities arise, people hire names they recognize.
6. Make Yourself Indispensable If you’re in a stable position, guard it wisely. Take on visible, high-impact projects that tie directly to business value. Strengthen relationships with your manager and cross-functional teams. The harder you are to replace, the safer you are.
7. Diversify Your Income Streams Consider freelancing, consulting, or working on independent projects in languages like Rust, Swift, or Python. Third-party firms often thrive when big corporations downsize. Multiple income sources give you flexibility—and peace of mind.
A Glimmer of Optimism
Despite all the turbulence, the long-term future for software engineers isn’t bleak. The Bureau of Labor Statistics projects 17% job growth in software development between 2023 and 2033—well above the national average.
Morgan Stanley Research predicts AI will ultimately increase hiring, not suppress it, as companies build more ambitious systems and modernize outdated infrastructure. GitHub Copilot’s adoption data backs this up: firms using AI coding tools actually hired 2.9% more engineers, suggesting that automation helps teams tackle larger projects rather than replace people.
In short, while entry-level hiring is taking the brunt of the adjustment, skilled engineers who embrace AI and develop strategic expertise are poised to thrive.
The Bottom Line
The layoff wave isn’t just on the horizon—it’s already rolling in. Between late 2025 and 2026, AI’s maturity and economic headwinds will collide, reshaping tech employment like never before. Junior engineers are in the danger zone, but no one’s truly safe.
Still, there’s hope for those willing to evolve. The real question isn’t whether AI will change software engineering—it already has. The question is whether you’ll change with it. Those who adapt, specialize, and learn to guide AI rather than compete with it will rise above the rest.
The clock’s ticking. Start preparing today—because the next wave of layoffs is coming fast, and the engineers who move first will be the ones left standing.