Losing a Tech Job Now Costs Workers Nearly $4,000 More Per Month Than Five Years Ago

In just five months of 2026, tech companies have laid off roughly 115,000 employees, nearly matching the full-year layoff total for 2025, reaching around 70% of the cuts seen in 2022 and 2024 and moving closer to the infamous 2023 record, when more than 264,000 tech workers lost their jobs.

As tech companies continue restructuring around AI, automation and post-pandemic overhiring, the financial impact of losing a tech job has changed dramatically. According to Insuranceopedia.com analysis, losing a tech job now costs workers nearly $4,000 more per month than it did just five years ago.

The Cost of Losing a Tech Job Is Rising Twice as Fast as Before 2021

Some say it’s because of AI and automation, while others argue the new wave of tech layoffs was inevitable after the post-pandemic hiring boom. For workers who lost their jobs over the past five months, it really doesn’t matter. The same companies that hired thousands of tech workers over the past few years are now making painful job cuts, but this time, the financial shock for employees is far more severe than before.

While companies like Meta and Google usually offer generous severance packages during major layoffs, including several months of pay and extended benefits, many smaller tech companies offer far less or no severance at all. And with severance pay generally not legally required in the U.S., many Big Tech packages are driven more by reputation and competition for talent than by law.

Still, even when laid-off workers get severance packages, reality hits quickly once those few months run out, and finding a new job during a wave of layoffs is not easy. Some scramble to cut every recurring bill, from streaming subscriptions to hunting for the cheapest car insurance, while others pivot away from traditional employment entirely, freelancing or launching their own ventures and suddenly having to budget for costs they rarely thought about as employees, like business insurance. So how much does it actually cost to lose a tech job in 2026?

The Insuranceopedia research team based the calculation on the software engineer profession, combining historical U.S. Bureau of Labor Statistics wage data with 2026 compensation estimates from Levels.fyi to measure how dramatically the monthly financial shock of losing a tech job has changed over time. The analysis also included benchmark ACA marketplace premiums sourced from KFF, because many laid-off tech workers also lose employer-sponsored health insurance, forcing them to suddenly cover expensive private healthcare costs out of pocket.

The results showed that a laid-off software engineer may now lose nearly $14,400 in monthly compensation and benefits, including an average salary of $13,750 and $625 in private health insurance costs.  Shockingly, that is $3,850, or 36% more than the monthly financial hit of losing a tech job back in 2021, and $5,215, or 56% more than a decade ago. The data also showed that the monthly cost of losing a tech job increased nearly twice as fast over the past five years as it did before 2021.

So, what’s driving such a painful increase? Before and during the pandemic, rising health insurance costs were the main driver of the growing financial shock of layoffs, surging 51% between 2016 and 2021. The average monthly pay rose by only 13% during that time. But after 2021, both wages and healthcare costs continued rising aggressively, jumping 36% and 38% over the past five years, respectively.

Even After Stripping Out Inflation, Losing a Tech Job Still Costs More

While some might argue that everything has become more expensive because of inflation, including the financial impact of losing a tech job, inflation explains only part of the surge in tech layoff costs.

The Insuranceopedia analysis showed that even after adjusting historical figures to 2026 dollars using U.S. Consumer Price Index data, the estimated monthly financial hit of losing a tech job still increased by $1,250 or 9.5%, climbing from roughly $13,100 in 2021 to nearly $14,400 in 2026, Compared to 2016, the inflation-adjusted monthly financial impact of losing a tech job rose by roughly $1,600, or nearly 13%.