The Two Companies Building AI Can’t Agree on What It Does to Jobs
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Yesterday we covered Altman’s reversal in detail. Today, Axios published a useful piece putting the two positions together and looking at what the data actually shows, which is messier than either narrative.
The case for the doom camp: Meta cut nearly 8,000 employees this month while projecting at least $125 billion in AI capital expenditures. Coinbase, Block, Pinterest, and Shopify have all tied job cuts to AI. The pattern is real and documented. The case against it: unemployment has risen since 2023, mostly in sectors with the least AI exposure, according to Stanford researchers. Software engineering job openings on Indeed are up over 18% year-over-year, while all openings are down 4.3%. LinkedIn’s chief economist said AI has created around 1.3 million new job postings.
Then there’s the cost angle, which doesn’t fit either story cleanly. Some large companies are pulling back on AI after promised productivity gains didn’t materialize. Uber’s COO said AI costs are getting “harder to justify” weeks after his CTO blew through the 2026 IT budget on AI usage. Microsoft is winding down some of its Claude Code licenses due to expense. As Sophia Velastegui, former Microsoft chief AI officer, put it: “AI costs a lot of money,” and layoffs can offset those costs. That framing suggests some cuts are as much about managing AI’s bill as about replacing workers with it.
My read: the transition is real, uneven, and anyone offering a confident headline either way is selling something. What we actually see at 4 Corner Resources is entry-level roles becoming harder to land, and clients openly questioning the headcount math they never questioned before. That shows up in hiring volume long before it shows up in the unemployment rate.
The NY Fed Says Wage Growth Has Leveled Off, But One Sector Didn’t Get the Memo
The Federal Reserve Bank of New York published new research Monday using its Trend Wage Inflation measure, or TWIn, which strips out month-to-month noise to show where wage growth is actually headed. The takeaway: after falling steadily since peaking in late 2021, TWIn has leveled off near its 2017-19 average. The NY Fed calls this consistent with a “broadly balanced” labor market; unemployment has barely moved since last summer, and its Labor Market Tightness Index has hovered near zero for months.
The catch for workers: the gap between wage growth and trend price inflation is narrower than in the late 2010s. Paychecks are growing more slowly in real terms. That’s the mood a lot of candidates are bringing into interviews right now; raises that look fine on paper but don’t feel like progress.
Most of the cooldown was broad-based across industries. One notable exception: construction and mining, where wage growth has stayed above the rest of the economy and actually risen since 2022. The NY Fed research team points to two likely drivers. AI data center construction is keeping demand for construction labor unusually high. And lower net immigration is tightening a sector that relies on immigrant workers more than most. We covered that immigration pipeline narrowing earlier this month, and it’s showing up directly in construction wages now.
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ADP Shows Private Hiring Slowed in Late May
ADP’s NER Pulse for the four weeks ending May 9 shows private employers added an average of 35,750 jobs per week, down from the prior week. That’s a step back from the 42,250 reading two weeks earlier and confirms the mid-April dip wasn’t fully reversed. Figures are preliminary and subject to revision as more payroll data comes in.
ADP’s Main Street Macro is on hiatus until June 9, so this is the last weekly pulse for a couple of weeks. That makes the next read from the monthly ADP report and the May BLS jobs data more important as a signal. The April monthly picture came in at 109,000 private sector jobs, stronger than expected. Whether May holds that pace is the next question.
The weekly number in the mid-30,000s isn’t a sign that the market is falling apart. It’s a market where employers are filling what they have to fill and sitting on the rest. Longer interview cycles, more approvals before an offer goes out, and roles that stay open without urgency. The macro number and the ground-level experience of any individual job seeker in a specific sector are genuinely different things.
