In 2026, the tech industry is expected to experience a sharp divergence in employment trends: product companies will likely continue workforce reductions, while IT services firms ramp up hiring amidst significant internal restructuring. This shift is fundamentally driven by AI. For product companies with fixed portfolios, AI-driven efficiencies mean fewer developers are required to build and maintain existing software. Conversely, while AI brings similar efficiencies to IT services, it also drastically lowers the overall cost of development. This price drop makes digital transformation accessible to a much broader range of businesses, creating a surge in project volume that will drive IT services firms to expand and adapt their workforce.