Half of Laid-Off Workers Came Back to Lower Pay. Here’s How to Avoid a Pay Cut in Your Next Job
Losing a job you held for years is hard enough. The newest government data says the bigger risk may come after you land the next one. Only about half of long-tenured workers who were laid off and found new full-time work are now earning as much as they did before, and a fresh Goldman Sachs analysis suggests workers pushed out of AI-exposed jobs are having an even rougher time. Here is what the numbers show, who is getting hit hardest, and what you can do to come back at the same pay or better.
Half of rehired workers took a pay cut
Every two years the Bureau of Labor Statistics asks people who lost a job involuntarily what happened next. Its latest Displaced Workers Summary found that 3.3 million workers lost jobs they had held for at least three years between January 2023 and December 2025. That is 746,000 more than in the previous survey period.
Getting back to work was not the main problem. By January 2026, 66.1% of those workers were employed again, about the same as two years earlier. The problem was the paycheck. Among those who went from one full-time job to another, about 49% were earning as much as or more than before, down from about 62% in the January 2024 survey.
The detail in BLS Table 7 is sobering. Of roughly 1.59 million rehired full-time workers, about 369,000 were making at least 20% less than at their old job, and another 317,000 were earning less but within 20%. Manufacturing was especially rough: of about 378,000 rehired full-time workers from that sector, around 117,000 took a cut of 20% or more.
What Goldman found about AI-related layoffs
On October 29, Goldman Sachs economist Pierfrancesco Mei published a note using that same survey, as Fortune reported. Because no survey question asks whether AI cost someone their job, Goldman scored each lost job by how exposed the occupation is to AI, how fast the industry is adopting it, and whether the position was eliminated outright. The top 30% were treated as likely AI-displaced.
Those workers took about a month longer to find a new job than other laid-off workers and were roughly 10 percentage points more likely to still be unemployed a year later. Goldman called the effect comparable to earlier waves of technology-driven layoffs going back to 1979, when displaced workers saw slower earnings growth for years afterward.
Age matters a lot. AI-displaced workers 35 and older took about five weeks longer than other displaced workers to get back to full-time work, compared with about three weeks for those under 35. Across all laid-off long-tenured workers, 72.9% of people ages 25 to 54 were working again by January 2026, versus 57.3% of those 55 to 64 and 38.6% of those 65 and older.
Employers are also saying the quiet part out loud. Challenger, Gray & Christmas counted 120,136 announced job cuts through September in which AI was cited, about 21% of all cuts and the single most common reason given, according to the Fortune report.
Why the pay drop happens
Goldman’s research points to a pattern seen in past tech shifts. People who lost jobs to technology were more likely to be rehired into more routine, less complex work, because the change that eliminated their role also made their specific skills worth less. Workers with shorter tenure did better, likely because their skills were less tied to one employer or occupation. Younger, college-educated, urban workers lost about half as much in cumulative earnings over ten years as other tech-displaced workers.
The broader job market is not helping. Employers added just 29,000 jobs in September and unemployment rose to 4.2%, and advertised wages on Indeed were up only 2.4% from a year earlier, according to Payscale’s October labor market update. When openings are thin, the temptation to grab the first offer is strong.
How to avoid becoming part of the 51%
1. Know your number before the first interview
Write down your full old compensation: base pay, bonus, overtime, employer 401(k) match and the value of health coverage. Then look up current posted ranges for the roles you want. Many states now require pay ranges in job ads, and Payscale notes that Connecticut’s expanded law took effect October 1. If a posting tops out below your old pay, you know before you spend weeks interviewing.
2. Use the time you have, and don’t panic at week six
The data says older and long-tenured workers often need more time. Plan for it. File for unemployment right away (our step-by-step unemployment guide explains how), negotiate severance before you sign anything, and if you received a layoff notice, use the notice period to search while still on payroll, as we covered in our WARN Act guide.
3. Move toward growing work, not just away from shrinking work
Goldman found that AI-displaced workers often switch fields, yet many land in roles with similar or even higher AI exposure. Before changing careers, check whether the new job is growing and whether it pays for skills that are hard to automate. Payscale highlights electrical engineering (advertised wages up 5.6%) and IT systems roles (up 4.7%), plus fast growth in data center jobs. Health care also keeps hiring. Our piece on the AI skills pay premium shows which skills employers say they will pay more for.
4. Sell your experience as an asset, not a cost
Long tenure can read as “expensive” to a hiring manager. Counter that with specifics: problems you solved, money you saved, people you trained, and how quickly you can be productive. Experienced workers tend to need less ramp-up time, so say so and put a number on it where you can.
5. Negotiate even when you feel like you can’t
A pay cut on the way in tends to follow you, because future raises are a percentage of your starting salary. Counter at least once, ask for a sign-on bonus or a guaranteed six-month pay review if base pay is fixed, and don’t reveal your lowest acceptable number. If you were let go in an AI-driven cut and the company later wants you back, you may have more leverage than you think; see our guide to negotiating a rehire after an AI layoff. And for why so many people settle too low, read our report on job seekers accepting pay cuts to get hired faster.
The bottom line
Most laid-off workers do find work again. What the latest BLS data and Goldman’s research show is that the real damage often shows up in the paycheck, and it can last for years. Knowing your number, giving yourself time, targeting growing fields and negotiating every offer are the best ways to come back at the pay you earned, not a step below it.
Sources: U.S. Bureau of Labor Statistics Displaced Workers Summary and Table 7 (January 2026 survey); Goldman Sachs research as reported by Fortune, October 30, 2026; Payscale October 2026 labor market update.