California Governor Gavin Newsom is planning a major change to the US state’s labour policies amid growing concerns that artificial intelligence (AI) systems are replacing workers across industries. The governor reportedly signed an executive order directing state agencies to study how to protect workers from displacement by AI, including incentives for companies to retain workers rather than automate jobs. A New York Times report claims that the order calls for collaboration between government agencies, academics, labour groups, and AI companies to study measures such as increased job training, new worker protections, and alternative economic models. It also explores whether policies like universal basic capital, which give residents stakes in financial assets such as stocks or wealth funds, could help offset the impact of automation.In a statement to NYT, Newsom said, “California has never sat back and watched as the future happened to us—and we won’t start now. But we must think bigger. This moment demands that we reimagine the entire system—how we work, how we govern, how we prepare people for the future.”The move comes amid warnings from AI executives that white-collar professions, including customer service, software development, legal services and marketing, could face significant disruption in the coming years. However, it’s important to note that California’s order does not create immediate legal changes but marks an early effort by a US state government to prepare for labour disruptions linked to AI adoption.
California to examine new labour protections as AI reshapes the job market
‘According to the executive order, California will review whether existing safety nets, such as unemployment insurance, remain sufficient in an AI-driven economy. The state also plans to expand retraining programs to help workers transition into new roles. The order highlights concerns that businesses adopting automation may increase profitability while workers face job losses and reduced bargaining power.In a recent speech, Newsom criticised systems that continue taxing labour while potentially supporting automation incentives. He said, “Businesses are going to make a fortune, and that’s why you cannot continue to have a payroll tax system that taxes jobs and then subsidises automation.”The governor’s office said changes to tax policy are not specifically included in the order, but could be considered as new labour frameworks are developed.The announcement follows layoffs across the technology industry, with companies including Meta, Amazon and Cisco citing AI-related efficiency gains while reducing staff.Anthropic co-founder Dario Amodei has previously predicted that roughly half of white-collar jobs could disappear within five years. Other technology leaders have disputed the timeline but broadly agree that AI will transform many professional roles.The debate has also led to renewed discussion around universal income policies. Elon Musk recently wrote: “Universal HIGH INCOME via checks issued by the Federal government is the best way to deal with unemployment caused by AI.”
