Survey finds AI adoption spurring shift in tech hiring from software to hardware
Sharon Wrobel is a tech reporter for The Times of IsraelThe wave of layoffs that has shaken Israel’s vaunted tech industry in recent weeks has sparked fears that artificial intelligence is curbing hiring and replacing jobs in the workplace. However, a survey published Tuesday indicated that AI is not a harbinger of the demise of the sector, but it is driving a shift in focus.The survey by the Israel Innovation Authority found that despite widespread job cut announcements, the overall number of tech employees in the first half of the year remained largely stable.But while the overall number of jobs was unaffected, an analysis of the High-Tech Employment survey points to stark sectoral divides, with hiring and layoff rates varying widely across the industry.Software companies continue to cut their workforce and lower costs amid rapid AI advances, while hardware, chip, and deep-tech companies continue to expand and hire at a…
A recent survey by the Israel Innovation Authority indicates that while AI is not causing a widespread decline in tech employment, it is driving a significant shift in the industry. The overall number of tech employees remained stable in the first half of the year, but software companies are experiencing workforce reductions due to AI advancements, while hardware, chip, and deep-tech companies are expanding and hiring. Dror Bin, CEO of the Israel Innovation Authority, stated, “We are not seeing a high-tech industry that is weakening, but one that is changing rapidly.” The survey also found that 50% of companies reported AI having a substantial impact on planned layoffs, up from 29% in December 2025, though business efficiency remains the primary driver for workforce reductions. This shift creates challenges for employees transitioning between sectors due to differing skill requirements.
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