Israeli Tech Firms Cut Thousands of Jobs as AI Shift and Strong Shekel Squeeze Margins
Updated
Updated · CTech · May 31
Israeli Tech Firms Cut Thousands of Jobs as AI Shift and Strong Shekel Squeeze Margins
3 articles · Updated · CTech · May 31
Wix, Amdocs, SentinelOne, Lightricks, BigID and Minute Media have announced or prepared layoffs affecting thousands of workers, with Meta also cutting more than 100 jobs in Israel.
The cuts come as AI lifts productivity and reduces demand for developers: Israel lost about 3,500 R&D jobs, while product roles grew by roughly 15,000 and R&D's workforce share fell to 49%.
A stronger shekel is adding pressure on exporters. The dollar's drop to an average NIS 3.45 in 2025 from NIS 3.7 a year earlier cut high-tech output by an estimated NIS 21 billion.
That strain is hitting an industry that still posted strong headline numbers in 2025, with fundraising up 30% to $14.6 billion, exports at $85 billion and exits reaching a record $84 billion.
The report also shows a longer-term shift abroad: the share of private tech-company employees based in Israel fell to 62% in March 2026 from 69% in 2019, while more senior roles and R&D moved overseas.
Is Israel’s global tech success creating titans abroad while hollowing out its local economy?
Could one Israeli facility in missile range bring the global AI and semiconductor industries to a halt?
Over 10,000 Laid Off in Israeli Tech, May 2026: AI and Strong Shekel Trigger Industry Overhaul
Overview
In May 2026, the Israeli tech sector faced a major wave of layoffs as companies, including industry leaders like Wix.com, shifted towards leaner operations. This restructuring was driven by the transformative influence of artificial intelligence, which firms used to signal innovation and efficiency in a changing market. Wix, for example, cut over 1,000 jobs to become a faster and flatter organization, aiming for quicker decisions and clearer ownership. These changes reflect a broader trend where companies leverage AI not only to streamline their workforce but also to adapt and stay competitive in a rapidly evolving tech landscape.