There are still plenty of people working in the coffee shops that line the streets around San Francisco’s Financial District and SoMa, the areas where, for ten years, the number of laptop-open workers on any given Tuesday afternoon served as a sort of economic bellwether. A few of them have jobs. Although some of them are officially working, they have been looking for work for a longer period of time than they will acknowledge at dinner parties.
For the first time in around two years, economists began using terms like “broadening recovery” when the overall American labor market gained 115,000 jobs in April 2026, exceeding estimates. 37,000 new jobs were created in the healthcare industry. 30,000 more came from transportation and storage. The employment market is improving. The data is less optimistic for someone with five years of software expertise and a computer science degree, and the reasons why are not totally clear.
Another 13,000 jobs were lost in April in the information sector, which is the Bureau of Labor Statistics category that includes data processing, telecom, media, and technology. 11,000 was lost in finance. These two industries have been losing jobs so steadily that, according to Kevin Gordon of Charles Schwab, payrolls in the technology industry have dropped to their lowest point since March 2021 in May, erasing four years’ worth of advances.
Net job loss for sixteen months in a row. That is an exceptionally long-lasting drop in a significant industry during a time when no official recession has been proclaimed, according to any historical metric. Yes, the job market is improving. Not for the employees at the desks, though.
The dichotomy that makes this scenario so hard to understand is the fact that employment and technology spending figures coexist. In 2026 alone, Google, Amazon, Microsoft, and Meta invested around $725 billion in AI infrastructure, including data centers, servers, cooling systems, fiber networks, and the physical foundation of the AI economy. Nevertheless, 4,000 jobs were lost in April in the BLS group that includes cloud and data infrastructure providers. This industry is meant to be constructing the future.
While the announcements of capital expenditures are breaking records, the employees who manage such data centers continue to see their payrolls cut. While hiring fewer people to manage the infrastructure, the corporations are spending far more on it. The BLS data doesn’t identify the causes, so it’s likely a combination of the following: AI is handling more of the work, the post-pandemic hiring excess is still being unwound, or the economics of cloud computing favor automation over headcount.
Gordon’s insight that tech jobs and stocks exist at opposite ends of the spectrum at the same time is the more difficult one. Stock prices are not employment records; rather, they represent expectations for future profits. If productivity increases from software and automation are reducing the number of employees needed to produce each dollar of sales, a business can be extremely valuable and lucrative while employing fewer people than it did five years ago. Manufacturing productivity has been operating in this manner for sixty years, so this dynamic is not new.
A generation of college graduates were taught that white-collar employment was structurally distinct from manufacturing, more difficult to automate, and safer to build a career on. However, this is changing suddenly. The causal chain is actually complex, therefore economists who are hesitant to establish a clear connection between AI and job losses are right to be wary. However, the record-low ratio of tech jobs to total employment and the 16 months of straight losses are facts, not forecasts, and they are part of the same picture as the $725 billion in AI capital expenditures.
The average monthly additions to the job market in 2026 are 76,000, which is a significant boost from 10,000 in 2025. Employers are hiring healthcare professionals. Employers are hiring warehouse workers. Home health aides, technicians, and drivers are being hired. The information sector is not the only one in the job market, and a significant number of people are finding employment in such industries.
However, there’s a sense that both the “office exile” and the “healing labor market” narratives are true, running concurrently, and that the people living in the second one aren’t finding much solace in being told the first is true as they watch the consecutive months of white-collar losses mount alongside the record tech company valuations.
