AI hiring demand continues rising even as the broader global labor market remains under pressure.
New data from Toptal’s Q1 2026 High-skilled Job Report shows demand for experienced remote and hybrid technology and professional services workers increased 8.9% quarter over quarter and 4.8% year over year.
At the same time, overall job postings across many major economies continued falling.
The Broader Job Market Is Still Weak
Hiring activity across most professions and experience levels declined roughly 3% quarter over quarter and 8% year over year across the US, UK, Canada, France, Germany, and Ireland.
Australia was the main exception, posting modest growth in both periods.
The figures point to a labor market that remains uneven despite pockets of hiring growth tied to AI and specialized technical work.
AI Is Changing Hiring Priorities
Companies are increasingly hiring for roles tied to AI deployment, automation, and digital transformation while becoming more selective about who they bring on.
Demand is growing most strongly for experienced workers with technical expertise, AI fluency, business judgment, and communication skills.
At the same time, opportunities for junior employees and generalist roles continue weakening as companies reassess workforce structures and operational costs.
Software engineering roles, which Toptal used as a proxy for the broader technology sector, began rebounding in mid-2025 even while overall job postings continued trending downward.
Tech Layoffs and AI Hiring Are Happening at the Same Time
The report also found a sharp increase in technology sector layoffs during Q1 2026.
Layoffs at technology companies rose 142% from the previous quarter and 140% year over year. Oracle’s reported reduction of 30,000 workers at the end of the quarter significantly affected the numbers.
At the same time, companies continue competing for a smaller pool of experienced AI, engineering, and professional services talent.
That split reflects a larger restructuring trend happening across the tech sector, where companies are reducing headcount broadly while still investing heavily in specialized roles tied to AI and automation.
Remote and Hybrid Roles Continue Outperforming
Toptal’s projections for Q2 2026 suggest overall US job growth will likely remain soft, with professional services hiring expected to continue declining moderately.
Technology hiring, however, is projected to stabilize after several years of contraction.
The strongest outlook remains concentrated in experienced remote and hybrid technology and professional services roles, where demand is expected to continue growing at a moderate pace.
The report suggests the labor market is increasingly dividing between weaker overall hiring conditions and continued demand for highly specialized workers connected to AI-driven business transformation.
