April Jobs Report Lands Amid Mounting AI Layoffs at Cloudflare, Coinbase and PayPal

The Bureau of Labor Statistics released its April employment report on Friday morning at 8:30 a.m. ET, with economists surveyed by Reuters expecting payrolls to grow by just 65,000 jobs and the unemployment rate to hold steady at 4.3 percent. The figures land against a backdrop of mounting tech-sector retrenchment that analysts increasingly tie not to a softening economy but to the rapid integration of generative artificial intelligence into white-collar work.

The outplacement firm Challenger, Gray & Christmas reported that U.S. employers announced 83,387 planned job cuts in April, a 38 percent increase from March. The technology industry alone accounted for 33,361 of those cuts, with Challenger noting that AI was the most-cited reason for the second consecutive month. Cloudflare confirmed it would lay off roughly 1,100 employees, with Chief Executive Matthew Prince telling staff the company must be "intentional in how we architect our company for the agentic AI era." Cloudflare separately reported that AI-driven traffic on its network has risen roughly six-fold over the past year.

The list of cuts goes well beyond infrastructure providers. Upwork said this week it would shed 24 percent of its staff — about 151 jobs — to "double down" on AI-native product development. Cryptocurrency exchange Coinbase confirmed plans to cut 700 employees, or roughly 14 percent of its workforce, citing the need to "optimize for the AI era." PayPal disclosed in a securities filing that it expects to reduce headcount by 20 percent, or more than 4,500 jobs, over the next two to three years as it consolidates customer-service and engineering teams around AI tooling.

Other indicators paint a more mixed picture. ADP's private payroll estimate showed a 109,000 increase in April, the strongest single-month gain since January 2025, suggesting that hiring outside of large tech firms has held up better than the layoff headlines imply. Average hourly earnings remained 3.5 percent above year-ago levels in March, outpacing headline inflation despite the energy-price spike that has pushed gasoline above $4.50 a gallon during the Strait of Hormuz crisis. The Cleveland Fed's nowcasting model, however, points to core PCE inflation hovering around 3.2 percent, well above the Federal Reserve's 2 percent goal.

Federal Reserve officials are watching Friday's release closely. Several regional bank presidents, including Philadelphia Fed President Patrick Harker, have argued in recent speeches that the labor market is in a "fragile equilibrium" between low hiring and slow labor-force growth, where any sustained shock — from oil prices, tariffs or large AI-driven cuts — could tip payrolls negative. Treasury Department officials told the Treasury Borrowing Advisory Committee earlier this quarter that average monthly private payroll growth in the first quarter ran at more than 2.5 times the 2025 monthly pace, even as hiring remained narrow.