This Week in Jobs: California Steps in as Companies Cut Jobs for AI

1 00:00:00,080 - > 00:00:01,439 Pete Newsome: Welcome back to the weekend jobs. 2 00:00:01,520 - > 00:00:03,839 I'm Pete Newsom, and you'll notice I'm solo today. 3 00:00:04,000 - > 00:00:07,440 Peter's out on vacation starting Memorial Day weekend early, but 4 00:00:07,440 - > 00:00:09,439 the job market news hasn't stopped. 5 00:00:09,519 - > 00:00:10,480 It never will. 6 00:00:10,640 - > 00:00:13,199 And this week we we had some big stories. 7 00:00:13,279 - > 00:00:16,800 It seems we have every week lately, centered around AI and 8 00:00:16,800 - > 00:00:18,559 centered around major job cuts. 9 00:00:18,719 - > 00:00:23,039 I wish that wasn't the case, but I don't create the news, and I 10 00:00:23,039 - > 00:00:26,000 don't think this is going to change anytime soon. 11 00:00:26,160 - > 00:00:29,120 So if you're tired of it already, I certainly am, at 12 00:00:29,120 - > 00:00:31,280 least about the job cuts. 13 00:00:31,519 - > 00:00:35,600 This is just seems to be the situation that we're in for the 14 00:00:35,600 - > 00:00:36,799 foreseeable future. 15 00:00:36,960 - > 00:00:39,280 And these headlines almost get ignored now. 16 00:00:39,439 - > 00:00:43,600 Some of the big cuts that happen would have been huge news if 17 00:00:43,600 - > 00:00:45,439 they happened in isolation. 18 00:00:45,759 - > 00:00:49,679 But these major employers' household names seem to keep 19 00:00:49,679 - > 00:00:50,240 piling on. 20 00:00:50,399 - > 00:00:54,240 Maybe they're just trying to get buried in headlines where this 21 00:00:54,240 - > 00:00:56,560 is taking place constantly. 22 00:00:56,960 - > 00:01:01,920 But it's a trend, it's a really bad trend that we're seeing not 23 00:01:02,000 - > 00:01:02,960 slowing down. 24 00:01:03,200 - > 00:01:05,680 And I don't know where this is going to end up. 25 00:01:05,920 - > 00:01:07,840 AI certainly isn't going away. 26 00:01:08,000 - > 00:01:10,239 That is only picking up speed. 27 00:01:10,400 - > 00:01:15,280 And we could argue, as many do, about whether these cuts are 28 00:01:15,280 - > 00:01:19,599 specifically tied to AI, if that's true, if it's AI washing, 29 00:01:19,680 - > 00:01:23,599 if these companies are really just right-sizing after 30 00:01:23,599 - > 00:01:25,200 overhiring post-COVID. 31 00:01:25,680 - > 00:01:27,840 The truth is, I think it's all of the above. 32 00:01:28,000 - > 00:01:29,840 At least that's my perspective. 33 00:01:30,159 - > 00:01:35,120 And we won't really know what each company is doing unless 34 00:01:35,120 - > 00:01:38,239 we're behind the closed doors where those decisions are being 35 00:01:38,239 - > 00:01:38,560 made. 36 00:01:38,799 - > 00:01:42,959 They're citing these layoffs as being technology-driven, 37 00:01:43,200 - > 00:01:49,280 AI-driven, investing in AI, gaining efficiencies from the AI 38 00:01:49,280 - > 00:01:50,319 investments. 39 00:01:50,640 - > 00:01:52,799 But the reality is we don't know. 40 00:01:52,959 - > 00:01:55,200 So I really do think it's all of the above. 41 00:01:55,359 - > 00:02:01,840 And I'm on the side of AI having a serious impact on jobs 42 00:02:01,840 - > 00:02:02,480 overall. 43 00:02:03,120 - > 00:02:06,480 And so what happened yesterday is there were two executive 44 00:02:06,480 - > 00:02:08,080 orders that were in play. 45 00:02:08,240 - > 00:02:10,719 One was signed, one was canceled. 46 00:02:10,960 - > 00:02:14,400 At the state level, and I've been talking about this for a 47 00:02:14,400 - > 00:02:17,919 while, that the government is going to become increasingly 48 00:02:17,919 - > 00:02:20,960 involved in AI's impact on the job market. 49 00:02:21,120 - > 00:02:23,039 They're now seeing it, as always. 50 00:02:23,199 - > 00:02:26,319 The government's a little slow to react with things, but I 51 00:02:26,319 - > 00:02:28,879 don't know if they can stop what's happening. 52 00:02:28,960 - > 00:02:32,639 And in some cases, at the federal level, I don't know, 53 00:02:32,800 - > 00:02:34,800 they're inclined to stop what's happening. 54 00:02:34,960 - > 00:02:40,000 So this is going to become a bigger story as time goes by, as 55 00:02:40,000 - > 00:02:44,639 we see more cuts, regardless of what they're attributed to AI, 56 00:02:44,719 - > 00:02:49,039 whether they're actually caused by AI, again, my take is that 57 00:02:49,039 - > 00:02:50,400 it's all of the above. 58 00:02:50,719 - > 00:02:52,240 But it is happening. 59 00:02:52,479 - > 00:02:55,759 And AI is becoming more prevalent in every aspect of 60 00:02:55,759 - > 00:02:56,719 life and business. 61 00:02:56,879 - > 00:03:01,039 And so the government is going to, of course, try to intervene. 62 00:03:01,280 - > 00:03:05,680 Their constituents are certainly going to put pressure on elected 63 00:03:05,680 - > 00:03:08,159 officials to try to protect them. 64 00:03:08,800 - > 00:03:12,080 But there's definitely a push and pull going on with this 65 00:03:12,080 - > 00:03:12,400 right now. 66 00:03:12,560 - > 00:03:16,080 So yesterday, California Governor Newsome signed an 67 00:03:16,080 - > 00:03:20,719 executive order aimed at protecting workers against AI's 68 00:03:20,719 - > 00:03:21,280 impact. 69 00:03:21,439 - > 00:03:24,560 He sounds to be specifically worried about white-collar 70 00:03:24,560 - > 00:03:24,879 roles. 71 00:03:25,039 - > 00:03:28,159 So customer service, software developer positions, marketing 72 00:03:28,159 - > 00:03:29,360 and sales roles. 73 00:03:29,680 - > 00:03:34,159 And he's called for subsidies for companies that keep workers 74 00:03:34,159 - > 00:03:35,280 instead of replacing them. 75 00:03:35,439 - > 00:03:39,360 Now, I've talked in the past about how there's a huge tax 76 00:03:39,360 - > 00:03:41,439 benefit to not hiring employees. 77 00:03:41,599 - > 00:03:45,360 If you hire a robot, you get a full write-off for that. 78 00:03:45,439 - > 00:03:49,360 If you have an employee, or you specifically get 100% 79 00:03:49,759 - > 00:03:51,439 depreciation in year one. 80 00:03:51,680 - > 00:03:54,240 That is a law that's been put in place. 81 00:03:54,400 - > 00:03:58,159 And that doesn't get talked about a lot, but it is an 82 00:03:58,159 - > 00:04:01,759 incentive for companies to make technology investments. 83 00:04:01,919 - > 00:04:02,879 That's the intention. 84 00:04:03,120 - > 00:04:06,719 But what's happening now that wasn't the case 20 years ago 85 00:04:06,719 - > 00:04:07,759 when investments were made. 86 00:04:07,840 - > 00:04:11,840 And by the way, those that 100% depreciation in year one did not 87 00:04:11,840 - > 00:04:13,199 exist 20 years ago. 88 00:04:13,439 - > 00:04:17,199 But now it forces companies to decide do I want to invest in a 89 00:04:17,199 - > 00:04:19,759 robot or do I want to invest in a human? 90 00:04:19,839 - > 00:04:23,600 Because the effective tax burden for hiring a person versus a 91 00:04:23,600 - > 00:04:26,560 robot is up to six times more. 92 00:04:26,720 - > 00:04:28,879 That also doesn't get talked about a lot. 93 00:04:29,120 - > 00:04:35,680 So the need to help companies be motivated to hire or to retain 94 00:04:35,680 - > 00:04:39,519 workers versus replacing them, that makes a lot of sense to me. 95 00:04:39,680 - > 00:04:42,800 I'm now look, I'm an anti-tax person overall. 96 00:04:43,360 - > 00:04:48,560 So as a staffing company owner, the payroll taxes that we pay, 97 00:04:48,800 - > 00:04:53,120 the fees that we pay to uh just to carry people on our payroll, 98 00:04:53,279 - > 00:04:55,920 I can tell you they're they're significant. 99 00:04:56,480 - > 00:04:57,199 They're massive. 100 00:04:57,279 - > 00:05:01,839 And when you look at 30% effective tax rate for an 101 00:05:01,839 - > 00:05:06,639 employee versus zero, well, that's gonna put a lot of 102 00:05:06,639 - > 00:05:10,000 companies in a place where they're gonna do what's best for 103 00:05:10,000 - > 00:05:13,040 them, which may not be best for society as a whole. 104 00:05:13,279 - > 00:05:14,639 So that's taking place. 105 00:05:14,879 - > 00:05:21,120 And I think that this executive order is a step in trying to 106 00:05:21,120 - > 00:05:21,680 stop that. 107 00:05:21,920 - > 00:05:26,079 What they're looking to do is try to assess how big this 108 00:05:26,079 - > 00:05:27,120 problem really is. 109 00:05:27,680 - > 00:05:31,040 The executive order calls for a risk analysis report to be 110 00:05:31,040 - > 00:05:31,759 developed. 111 00:05:31,839 - > 00:05:36,560 Uh they're looking to um create a deployment and analysis 112 00:05:36,560 - > 00:05:40,480 framework that they can maintain and update going forward, and 113 00:05:40,480 - > 00:05:44,800 they're also looking to train employees in the state who have 114 00:05:44,800 - > 00:05:46,480 been displaced because of AI. 115 00:05:46,800 - > 00:05:49,680 So there's definitely an effort. 116 00:05:49,839 - > 00:05:53,120 California is ahead of the curve with this, with other companies 117 00:05:53,120 - > 00:05:56,160 who've said, we're concerned about this, we think it's a 118 00:05:56,160 - > 00:05:59,040 growing problem, and we're going to try to do something about it. 119 00:05:59,199 - > 00:06:01,519 Now, can they stop this AI train? 120 00:06:01,680 - > 00:06:04,879 That's the other side of the equation here. 121 00:06:05,519 - > 00:06:09,439 Trump was supposed to be signing an executive order yesterday, 122 00:06:09,600 - > 00:06:13,920 which coincidentally was, or I'll rather say ironically, was 123 00:06:13,920 - > 00:06:17,839 canceled a few hours after the California executive order was 124 00:06:17,839 - > 00:06:18,240 signed. 125 00:06:18,480 - > 00:06:22,240 What the executive order that Trump was intending to sign 126 00:06:22,240 - > 00:06:25,279 yesterday, that he canceled, would have established a 127 00:06:25,279 - > 00:06:29,120 framework for the government to vet national security risks of 128 00:06:29,120 - > 00:06:32,079 the vo of the most advanced AI systems before they were 129 00:06:32,079 - > 00:06:33,199 publicly released. 130 00:06:33,360 - > 00:06:37,360 It was recently compared by Kevin Hazett, who's one of 131 00:06:37,360 - > 00:06:42,959 Trump's major advisors on this, as similar to approving an FDA 132 00:06:42,959 - > 00:06:43,199 drug. 133 00:06:43,279 - > 00:06:46,160 And that probably makes a lot of people cringe to hear. 134 00:06:46,399 - > 00:06:50,879 But what they essentially wanted to do was look at the new AI 135 00:06:50,879 - > 00:06:53,759 tools before they were allowed to be used by the public and 136 00:06:53,759 - > 00:06:56,800 decide how risky they were, how safe they were. 137 00:06:57,199 - > 00:06:58,959 And he's taken that off the table. 138 00:06:59,120 - > 00:07:03,199 Now I don't know this, but I suspect that a lot of the people 139 00:07:03,199 - > 00:07:07,680 who helped him get elected were in his ear not happy about this, 140 00:07:07,839 - > 00:07:11,519 even though supposedly the major AI companies were behind it. 141 00:07:11,759 - > 00:07:15,600 Someone convinced him to remove it, and he says it's because we 142 00:07:15,600 - > 00:07:19,839 don't want to weaken America's competitiveness against China. 143 00:07:20,639 - > 00:07:26,000 And that's why this is such a tough thing, because we know 144 00:07:26,000 - > 00:07:29,680 that they're going to keep pushing the envelope with AI, as 145 00:07:29,680 - > 00:07:34,800 will other countries, as will people who aren't going to 146 00:07:34,800 - > 00:07:35,680 follow the rules. 147 00:07:35,920 - > 00:07:38,079 So this is a mess. 148 00:07:38,240 - > 00:07:45,759 And I don't blame, credit anyone for how they're trying to solve 149 00:07:45,759 - > 00:07:50,079 this, how they're trying to manage this, because no one 150 00:07:50,079 - > 00:07:52,000 really knows where all of this is leading. 151 00:07:52,160 - > 00:07:55,040 We still have almost an equal number of people saying that 152 00:07:55,040 - > 00:07:59,040 there's going to be as much job creation as there is job loss as 153 00:07:59,040 - > 00:08:00,319 a result of AI. 154 00:08:00,639 - > 00:08:04,959 But we do know that this is something that is becoming 155 00:08:05,279 - > 00:08:08,560 increasingly important for all of us. 156 00:08:08,800 - > 00:08:12,879 And as it relates to the cuts that are happening, the 157 00:08:12,879 - > 00:08:15,439 government just can't ignore it any further. 158 00:08:16,000 - > 00:08:18,319 It's becoming a really big deal. 159 00:08:18,560 - > 00:08:20,560 And the the cuts are massive. 160 00:08:20,720 - > 00:08:24,240 So let's let's talk about that too, because that is also part 161 00:08:24,240 - > 00:08:30,079 of this story, where it's not just that AI exists, it's that 162 00:08:30,079 - > 00:08:31,360 companies are acting on it. 163 00:08:31,439 - > 00:08:36,080 So Meta this week enacted the job cuts that they were they've 164 00:08:36,080 - > 00:08:37,120 been talking about for a while. 165 00:08:37,200 - > 00:08:40,480 There were rumors, and then they confirmed them, and now it 166 00:08:40,480 - > 00:08:41,200 finally happened. 167 00:08:41,360 - > 00:08:46,159 So they laid off 8,000 people, they reassigned 7,000 to AI 168 00:08:46,159 - > 00:08:46,399 teams. 169 00:08:46,559 - > 00:08:48,399 And when you think about those numbers, they're easy to say, 170 00:08:48,480 - > 00:08:48,639 right? 171 00:08:48,799 - > 00:08:50,480 8,000, 7,000. 172 00:08:50,960 - > 00:08:54,639 This is an enormous amount of people whose lives were just 173 00:08:54,639 - > 00:08:58,320 affected by the layoff in a very significant negative way. 174 00:08:58,399 - > 00:09:02,879 And now we have 7,000 roles being reassigned specifically to 175 00:09:02,879 - > 00:09:03,519 AI. 176 00:09:03,840 - > 00:09:07,600 That is just, it should be major news on its own, its own, as I 177 00:09:07,600 - > 00:09:08,240 said earlier. 178 00:09:08,399 - > 00:09:11,679 But it just kind of gets buried now because these big numbers, 179 00:09:11,840 - > 00:09:14,639 we're seeing them so frequently that we don't really react to 180 00:09:14,639 - > 00:09:15,120 them anymore. 181 00:09:15,200 - > 00:09:17,519 It all almost seems like monopoly money that we're 182 00:09:17,519 - > 00:09:18,000 talking about. 183 00:09:18,240 - > 00:09:20,399 It's yeah, we read it, but it's not real. 184 00:09:20,480 - > 00:09:24,320 Or unless it impacts us specifically, it's hard to react 185 00:09:24,320 - > 00:09:24,720 to it. 186 00:09:24,799 - > 00:09:27,120 But these are major things taking place right now. 187 00:09:27,279 - > 00:09:29,440 They also cancel 6,000 rolls. 188 00:09:29,600 - > 00:09:35,039 So a total of 21,000 positions affected at a single company, 189 00:09:35,279 - > 00:09:37,279 all centered around AI. 190 00:09:37,519 - > 00:09:44,159 Meanwhile, they're spending up to 135 billion, 135 billion on 191 00:09:44,159 - > 00:09:46,159 AI in 2026. 192 00:09:46,639 - > 00:09:52,559 So this is such a big thing that is going to impact all of our 193 00:09:52,559 - > 00:09:56,399 lives, that of course the government has to start getting 194 00:09:56,399 - > 00:09:57,279 involved. 195 00:09:57,759 - > 00:10:01,759 State of California's trying to protect workers. 196 00:10:01,919 - > 00:10:05,200 The federal government seems to be backing off, putting some 197 00:10:05,200 - > 00:10:06,639 restrictions in place. 198 00:10:07,039 - > 00:10:11,120 But as the weeks and months go on, I think we're going to 199 00:10:11,120 - > 00:10:15,120 continue to see more people calling for the government to do 200 00:10:15,120 - > 00:10:15,679 something about it. 201 00:10:15,840 - > 00:10:20,320 I just don't know how much they will or can do about it going 202 00:10:20,320 - > 00:10:20,639 forward. 203 00:10:20,720 - > 00:10:25,200 But this cut and rebuild model seems to be what's in vogue 204 00:10:25,200 - > 00:10:28,559 right now, where companies are making big cuts. 205 00:10:28,720 - > 00:10:30,240 Maybe they work out, maybe they don't. 206 00:10:30,399 - > 00:10:33,919 Maybe they're specifically because of AI, maybe they're 207 00:10:33,919 - > 00:10:34,000 not. 208 00:10:34,159 - > 00:10:38,399 Maybe they were overhiring reasons, maybe they're not. 209 00:10:38,720 - > 00:10:41,279 But we know the cuts are happening, and that's what's 210 00:10:41,279 - > 00:10:42,159 most relevant here. 211 00:10:42,320 - > 00:10:45,440 The reasons behind it to me are secondary. 212 00:10:46,639 - > 00:10:50,080 But companies are trying to figure out how to leverage AI. 213 00:10:50,159 - > 00:10:52,720 They're trying to figure out how to gain efficiencies, how to cut 214 00:10:52,720 - > 00:10:56,720 costs, and as we talked about earlier, when you're faced with 215 00:10:57,039 - > 00:11:01,840 100% depreciation on a new technology that you can invest 216 00:11:02,080 - > 00:11:07,120 in versus an expensive employee, these public companies at least 217 00:11:07,360 - > 00:11:11,200 are probably going to err on the side of trying to get the 218 00:11:11,200 - > 00:11:11,759 savings. 219 00:11:12,000 - > 00:11:13,600 It just makes sense to do. 220 00:11:13,759 - > 00:11:16,240 Whether they should do it morally, ethically, that's a 221 00:11:16,240 - > 00:11:16,960 different discussion. 222 00:11:17,120 - > 00:11:18,000 It is happening. 223 00:11:18,240 - > 00:11:20,320 So that is what's been going on there. 224 00:11:20,480 - > 00:11:24,559 And we've also seen some cuts at other major companies, which I 225 00:11:24,799 - > 00:11:30,480 continue to say and be surprised by that these things on their 226 00:11:30,480 - > 00:11:32,000 own would be big story. 227 00:11:32,159 - > 00:11:35,360 Standard Chartered eliminates 7,000 jobs. 228 00:11:35,519 - > 00:11:37,200 7,000, like it's no big deal. 229 00:11:37,360 - > 00:11:42,000 And their CEO said that what they're doing is replacing lower 230 00:11:42,080 - > 00:11:43,840 value human capital. 231 00:11:44,480 - > 00:11:49,279 Okay, so that's where AI really starts to have an impact first 232 00:11:49,279 - > 00:11:50,000 on what's happening. 233 00:11:50,159 - > 00:11:54,480 And yes, AI makes mistakes, yes, it hallucinates. 234 00:11:54,639 - > 00:11:56,080 Oh, it's far from perfect. 235 00:11:56,240 - > 00:12:01,039 I mean, my own AI that I use continues to not be able to 236 00:12:01,039 - > 00:12:03,039 grasp what day of the week it is. 237 00:12:03,200 - > 00:12:06,960 It's almost become laughable to me how consistently it happens, 238 00:12:07,279 - > 00:12:11,120 where it just puts, it has access to a calendar of all the 239 00:12:11,120 - > 00:12:12,399 complex things it can do. 240 00:12:12,639 - > 00:12:16,480 It doesn't ever seem to be able to match up the day of the week 241 00:12:16,480 - > 00:12:17,840 with the day of the month. 242 00:12:18,000 - > 00:12:21,200 And it I, you know, so it's far from perfect at this point. 243 00:12:21,360 - > 00:12:22,240 We know that. 244 00:12:22,559 - > 00:12:27,039 But what AI does effectively is repetitive tasks. 245 00:12:27,200 - > 00:12:30,399 And there's the CEO of Standard Charter referred to this as 246 00:12:30,399 - > 00:12:31,840 lower value human capital. 247 00:12:31,919 - > 00:12:35,919 And I see where he's coming from with that because if AI can do 248 00:12:35,919 - > 00:12:40,240 something that is a low-level administrative effort that is 249 00:12:40,240 - > 00:12:43,519 easy to replace, well, of course they're going to do that. 250 00:12:43,600 - > 00:12:47,759 Now the hope is that we're in the and the AI optimists will 251 00:12:48,080 - > 00:12:51,200 say that the result of all of this is going to elevate what 252 00:12:51,200 - > 00:12:52,720 humans get to spend their time doing. 253 00:12:52,879 - > 00:12:55,519 No one likes to do administrative repetitive tasks 254 00:12:55,519 - > 00:12:57,120 that are boring and dull. 255 00:12:57,679 - > 00:13:00,960 We want people to be doing things that are more interesting 256 00:13:00,960 - > 00:13:04,480 to them, that add more value to an organization. 257 00:13:04,799 - > 00:13:06,960 But when you see the cuts, that's not happening. 258 00:13:07,039 - > 00:13:08,559 And that's that's my issue with this. 259 00:13:08,720 - > 00:13:11,279 It's great that the potential is there to do more strategic 260 00:13:11,279 - > 00:13:14,399 things and creative things and really let humans be the best 261 00:13:14,399 - > 00:13:15,440 that they can be. 262 00:13:15,679 - > 00:13:18,240 But what's going to happen to those 7,000 workers who are 263 00:13:18,240 - > 00:13:21,120 losing their jobs in a very competitive market? 264 00:13:21,440 - > 00:13:26,879 Because since presumably they're the ones doing this low-value 265 00:13:26,879 - > 00:13:30,480 human capital work, as he put it, well, those are the other 266 00:13:30,480 - > 00:13:31,600 people getting cut too. 267 00:13:31,679 - > 00:13:34,399 So now we have people competing for the same jobs. 268 00:13:34,480 - > 00:13:39,600 And we'll talk about in just a minute how it's kind of a state 269 00:13:39,600 - > 00:13:41,120 of two different job markets. 270 00:13:41,200 - > 00:13:45,200 But I first just want to mention that in two it also cut 3,000 271 00:13:45,200 - > 00:13:47,840 jobs, which is 17% of its workforce. 272 00:13:48,080 - > 00:13:52,559 3,000 jobs, 3,000, 3,000 people affected and no longer employed. 273 00:13:52,720 - > 00:13:54,399 And that one just gets buried, right? 274 00:13:54,639 - > 00:13:58,159 It was in all the headlines for a second and now it's gone. 275 00:13:58,399 - > 00:14:03,519 But individually, these are all really big stories that uh at 276 00:14:03,600 - > 00:14:07,039 least should be bigger stories in a normal world, but right now 277 00:14:07,200 - > 00:14:08,879 they're they're just getting buried. 278 00:14:08,960 - > 00:14:16,159 And so you if you look at who's getting cut, this is not equal. 279 00:14:16,480 - > 00:14:17,360 It's not equal. 280 00:14:17,440 - > 00:14:20,559 And a lot of people will say that the job market is really 281 00:14:20,559 - > 00:14:24,720 strong right now because of all the hiring that's going on in 282 00:14:24,720 - > 00:14:27,600 construction, in healthcare. 283 00:14:27,759 - > 00:14:30,399 And yes, those things are true. 284 00:14:30,720 - > 00:14:34,720 But here's the problem: we have a shortage of workers in those 285 00:14:34,720 - > 00:14:35,200 areas. 286 00:14:35,440 - > 00:14:39,360 So the people who, those low-value people who are getting 287 00:14:39,360 - > 00:14:42,960 cut, they can't step into nursing jobs, they can't step 288 00:14:42,960 - > 00:14:44,799 into skilled trades work. 289 00:14:46,240 - > 00:14:48,240 This is a this is two job markets. 290 00:14:48,320 - > 00:14:49,360 One's getting worse, right? 291 00:14:49,440 - > 00:14:53,120 That we're having a greater need for healthcare professionals as 292 00:14:53,120 - > 00:14:55,679 people are dying faster than they're being born, people are 293 00:14:55,679 - > 00:15:00,240 getting sick faster than new people are coming into the 294 00:15:00,240 - > 00:15:00,960 workforce. 295 00:15:01,120 - > 00:15:04,559 So the need for healthcare professionals is going to 296 00:15:04,559 - > 00:15:08,000 increase in the foreseeable future over the over the next 10 297 00:15:08,000 - > 00:15:08,240 years. 298 00:15:08,399 - > 00:15:12,879 By 2030, deaths will outpace births in our country. 299 00:15:13,120 - > 00:15:15,440 And we have immigration dropping. 300 00:15:15,600 - > 00:15:18,720 It's going to drop 90% over the next two years. 301 00:15:18,879 - > 00:15:22,000 There was a story about that this week that indeed put out, 302 00:15:22,080 - > 00:15:25,120 and so we're seeing lower interest for foreign workers 303 00:15:25,120 - > 00:15:25,440 right now. 304 00:15:25,600 - > 00:15:29,919 Okay, so immigration's down, people are getting older, people 305 00:15:29,919 - > 00:15:32,879 are getting sicker, and we already don't have enough 306 00:15:32,879 - > 00:15:33,440 nurses. 307 00:15:33,600 - > 00:15:36,320 We already have it don't have enough healthcare professionals 308 00:15:36,320 - > 00:15:38,399 who are not easy to replace. 309 00:15:38,639 - > 00:15:43,840 Similarly, with construction, those roles are booming right 310 00:15:43,840 - > 00:15:44,000 now. 311 00:15:44,080 - > 00:15:46,799 And it's great for the workers in that area, but it's not great 312 00:15:46,799 - > 00:15:51,360 for us overall because we don't have enough people to do the 313 00:15:51,360 - > 00:15:51,519 work. 314 00:15:51,679 - > 00:15:55,360 We already have a shortage of half a million skilled trades 315 00:15:55,360 - > 00:15:56,799 workers in the country. 316 00:15:57,039 - > 00:16:01,120 And similar to healthcare, we're losing people faster than we're 317 00:16:01,120 - > 00:16:01,759 replacing them. 318 00:16:01,840 - > 00:16:05,519 For every five people who retire in skilled trades, only two are 319 00:16:05,519 - > 00:16:06,879 coming in behind them. 320 00:16:07,120 - > 00:16:11,039 So that is what is so fascinating to me and also 321 00:16:11,279 - > 00:16:15,440 somewhat terrifying about the current state of the job market. 322 00:16:15,759 - > 00:16:21,039 And yes, it's awesome that AI is creating a lot of jobs in 323 00:16:21,039 - > 00:16:23,440 construction because of the data centers. 324 00:16:23,919 - > 00:16:26,960 We won't get into whether the data centers are a good idea 325 00:16:27,039 - > 00:16:27,360 right now. 326 00:16:27,440 - > 00:16:33,120 There's obviously two very uh different camps on that, on 327 00:16:33,120 - > 00:16:35,519 whether they're a good thing, whether they're a bad thing. 328 00:16:35,759 - > 00:16:39,200 But no one can deny that they are creating a need for more 329 00:16:39,519 - > 00:16:42,240 people to work in the construction space, more skilled 330 00:16:42,480 - > 00:16:43,519 trades workers. 331 00:16:44,159 - > 00:16:46,720 But that just means it's gonna be harder for everyone else to 332 00:16:46,720 - > 00:16:48,080 hire skilled trades. 333 00:16:48,240 - > 00:16:51,440 It's gonna be higher at the residential level level, it's 334 00:16:51,440 - > 00:16:57,519 gonna be harder at the uh for construction projects that don't 335 00:16:57,519 - > 00:17:00,240 involve data centers because these AI companies building the 336 00:17:00,240 - > 00:17:03,039 data centers have unlimited budgets to throw at this. 337 00:17:03,200 - > 00:17:06,240 So it's it's it's really just a big mess. 338 00:17:06,480 - > 00:17:11,599 And so the theme for this week to me is the government is 339 00:17:11,759 - > 00:17:14,559 starting to draw a line in the sand about this. 340 00:17:14,799 - > 00:17:17,279 California's made their position very clear. 341 00:17:17,440 - > 00:17:19,279 They're looking to protect workers. 342 00:17:19,440 - > 00:17:22,079 I expect other states to follow soon. 343 00:17:22,319 - > 00:17:25,359 I don't know how effective they can be at it, but they're going 344 00:17:25,359 - > 00:17:26,000 to try. 345 00:17:26,240 - > 00:17:30,319 The federal government, at least for now, has seemed to back off 346 00:17:30,480 - > 00:17:32,640 trying to slow these things down. 347 00:17:32,799 - > 00:17:34,160 They don't want the U.S. 348 00:17:34,319 - > 00:17:36,480 to fall behind to China. 349 00:17:37,039 - > 00:17:40,559 If that is truly their motive for doing this. 350 00:17:40,799 - > 00:17:43,039 And just like all these decisions that are being made, 351 00:17:43,200 - > 00:17:45,839 unless you're in the room where it's happening, you don't really 352 00:17:45,839 - > 00:17:46,000 know. 353 00:17:46,079 - > 00:17:47,920 But that's what they're saying publicly. 354 00:17:48,400 - > 00:17:52,160 The floodgates are still open, AI is going to continue to go 355 00:17:52,160 - > 00:17:55,440 full speed ahead for the foreseeable future. 356 00:17:55,920 - > 00:18:00,960 So expect more job loss, expect more cuts, and we'll see where 357 00:18:00,960 - > 00:18:02,400 it where it all leads. 358 00:18:02,640 - > 00:18:05,759 Because we are living this in real time together. 359 00:18:06,000 - > 00:18:09,680 And as I always say on this topic, anyone who tells you 360 00:18:09,680 - > 00:18:13,839 definitively that they know what to expect, don't believe them. 361 00:18:14,079 - > 00:18:16,640 Because we've never experienced anything like this before. 362 00:18:16,880 - > 00:18:17,759 This is an experiment. 363 00:18:17,839 - > 00:18:19,599 We're living in real time together. 364 00:18:19,759 - > 00:18:21,680 So it makes sense to pay attention to it. 365 00:18:21,839 - > 00:18:25,359 That's why I talk about it so much and pay attention so 366 00:18:25,359 - > 00:18:26,319 closely to what's happening. 367 00:18:26,400 - > 00:18:29,039 And that's what I encourage everyone else to do, because 368 00:18:29,039 - > 00:18:31,279 eventually this is going to come to your doorstep. 369 00:18:31,519 - > 00:18:36,480 So even if you're going to retire soon, well, that means 370 00:18:36,480 - > 00:18:39,440 you're probably older, and that means what's happening in the 371 00:18:39,440 - > 00:18:41,200 healthcare market's going to affect you. 372 00:18:41,359 - > 00:18:44,720 If you work in an industry that doesn't, you don't think is 373 00:18:44,720 - > 00:18:50,960 going to be impacted by I by AI, well, good luck because it 374 00:18:50,960 - > 00:18:52,000 ultimately will. 375 00:18:52,079 - > 00:18:53,440 It's going to hit all of us. 376 00:18:53,599 - > 00:18:57,359 So for everyone in the workforce, pay attention to 377 00:18:57,359 - > 00:18:57,519 this. 378 00:18:58,240 - > 00:18:59,759 Use it, embrace it. 379 00:19:00,079 - > 00:19:01,440 Don't don't be afraid of it. 380 00:19:01,519 - > 00:19:04,640 Don't ignore it by by all by all means. 381 00:19:04,960 - > 00:19:10,480 And try your best to look ahead and see how it is going to 382 00:19:10,480 - > 00:19:15,519 impact your profession, your company, your ability to earn 383 00:19:15,519 - > 00:19:16,079 income. 384 00:19:16,480 - > 00:19:18,880 That's incumbent upon all of us because I don't think there's 385 00:19:18,880 - > 00:19:20,160 anyone coming to save us, right? 386 00:19:20,319 - > 00:19:22,880 The government's going to try, they're going to try to jump in, 387 00:19:23,200 - > 00:19:26,480 maybe for different interests that align with yours. 388 00:19:26,640 - > 00:19:28,960 And so don't count on anyone else here. 389 00:19:29,200 - > 00:19:31,839 So that those are the big stories for today. 390 00:19:32,000 - > 00:19:37,759 Again, big cuts, big employers' cuts that happened, and these 391 00:19:38,000 - > 00:19:41,680 executive orders, one signed, one canceled. 392 00:19:41,920 - > 00:19:44,960 We'll see what happens with that over the weeks and months to 393 00:19:44,960 - > 00:19:45,119 come. 394 00:19:45,279 - > 00:19:47,519 There's definitely going to be more news in that area. 395 00:19:47,680 - > 00:19:50,799 But before we close, I do want to try to find some positive 396 00:19:50,799 - > 00:19:51,200 news. 397 00:19:51,440 - > 00:19:55,359 I don't I always look for this to end with. 398 00:19:55,759 - > 00:19:58,240 Sometimes we find it, sometimes we don't. 399 00:19:58,640 - > 00:20:02,720 But there is some, there is there is some positivity right 400 00:20:02,720 - > 00:20:07,440 now, and that is that we're seeing some uh we're seeing an 401 00:20:07,440 - > 00:20:11,119 uptick in in in hiring, at least at the private level, according 402 00:20:11,119 - > 00:20:11,839 to ADP. 403 00:20:11,920 - > 00:20:16,640 The ADP pulse rebounded this week with 42,250 jobs, or rather 404 00:20:16,799 - > 00:20:18,000 last week that were added. 405 00:20:18,160 - > 00:20:20,559 So that's heading in a good direction. 406 00:20:20,720 - > 00:20:23,519 Uh unemployment seems to be just flat. 407 00:20:23,599 - > 00:20:26,799 So even though we're seeing all these big layoffs, that hasn't 408 00:20:26,799 - > 00:20:28,480 caught up to the unemployment numbers. 409 00:20:28,559 - > 00:20:31,039 They came in at 209,000 for last week. 410 00:20:31,279 - > 00:20:33,839 So we're we're holding pretty steady there, which is good 411 00:20:34,240 - > 00:20:36,720 because the unemployment isn't historically high. 412 00:20:36,960 - > 00:20:40,480 And I do scratch my head a little bit about that, why we 413 00:20:40,480 - > 00:20:42,240 haven't seen that uptick yet. 414 00:20:42,400 - > 00:20:44,079 But for now, we're holding pretty steady. 415 00:20:44,240 - > 00:20:46,880 So the job market as a whole isn't bad, although selectively 416 00:20:46,960 - > 00:20:47,519 it is, right? 417 00:20:47,599 - > 00:20:50,720 I mean, and it's balanced by some areas doing really well, 418 00:20:51,039 - > 00:20:54,240 some certainly at the lower level, starting to be impacted. 419 00:20:54,319 - > 00:20:56,720 So, but for now, overall, it is steady. 420 00:20:56,799 - > 00:21:01,440 And then Strata Institute found that employers expect AI to 421 00:21:01,440 - > 00:21:06,160 increase entry-level hiring at a three to one ratio over time. 422 00:21:06,480 - > 00:21:08,799 So let's hope they're right. 423 00:21:08,880 - > 00:21:14,319 And and that is ultimately what if I if I try to be optimistic, 424 00:21:14,640 - > 00:21:18,720 if I have to be optimistic about AI's impact on the job market, 425 00:21:18,960 - > 00:21:22,960 is that we'll, while we're dealing with cuts now, and then 426 00:21:23,039 - > 00:21:26,079 granted this doesn't help anyone who's who is dealing with it in 427 00:21:26,079 - > 00:21:29,839 the moment, but that ultimately new opportunities will be 428 00:21:29,839 - > 00:21:33,519 created that we just can't foresee yet, that there will be 429 00:21:33,519 - > 00:21:37,839 a need for people in roles that have never previously existed. 430 00:21:38,160 - > 00:21:41,920 So that that is, I I I believe that is going to happen. 431 00:21:42,079 - > 00:21:45,519 To what degree versus the cuts, that's where it gets a little 432 00:21:45,519 - > 00:21:47,920 fuzzy for me or really fuzzy for me. 433 00:21:48,079 - > 00:21:50,000 And I'm not as optimistic. 434 00:21:50,319 - > 00:21:54,640 But there are a lot of a lot of smart people who are very 435 00:21:54,640 - > 00:21:58,400 optimistic about it, and I have to acknowledge that. 436 00:21:58,559 - > 00:21:59,759 And Strata Institute. 437 00:22:00,240 - > 00:22:03,920 Saying that this is going to increase entry-level hiring 438 00:22:03,920 - > 00:22:06,000 three to one instead of decreasing it. 439 00:22:06,240 - > 00:22:08,079 Well, let's hope they're right. 440 00:22:08,319 - > 00:22:10,559 And let's hope I'm wrong. 441 00:22:10,799 - > 00:22:12,079 But we're all going to see. 442 00:22:12,240 - > 00:22:14,160 So please pay attention to it. 443 00:22:14,400 - > 00:22:16,960 And um, you know, it's not it's not going away. 444 00:22:17,119 - > 00:22:19,279 That we all I'm sure agree on. 445 00:22:19,440 - > 00:22:20,880 So that is it for today. 446 00:22:20,960 - > 00:22:24,079 I will say goodbye for now, and I will look really hard between 447 00:22:24,079 - > 00:22:27,519 now and next Friday to find some really optimistic news and 448 00:22:27,519 - > 00:22:29,519 positivity in the job market to talk about. 449 00:22:29,680 - > 00:22:32,240 But in the meantime, have a safe, great Memorial Day 450 00:22:32,240 - > 00:22:32,559 weekend. 451 00:22:32,640 - > 00:22:33,279 We'll talk soon.