Dive Brief:
- U.S. Senators Josh Hawley (R-Mo.) and Mark Warner (D-Va.) presented the draft of a bill Wednesday that would require major companies to report AI-related layoffs to the U.S. Department of Labor quarterly.
- The “AI-Related Job Impacts Clarity Act” – which has yet to be introduced – would require public companies and federal agencies to disclose the number of employees laid off largely due to AI within 30 days of the last day of each quarter. The bill’s goal is to ensure AI “drives opportunity instead of leaving workers behind.”
- “This bipartisan legislation will finally give us a clear picture of AI’s impact on the workforce – what jobs are being eliminated, which workers are being retrained, and where new opportunities are emerging,” Warner said in a press release.
Dive Insight:
The proposed AI bill comes as industries grapple with the labor impacts of ongoing AI adoption.
While the legislation targets publicly traded companies and federal agencies, it could also include privately-held companies depending on the company’s workforce size and annual revenue, according to the bill text.
“This essentially is a scarlet letter,” said Rob Atkinson, president of the Information Technology and Innovation Foundation, a nonprofit public policy think tank. “When firms come out and report that ‘this many jobs were lost because of AI,’ they’ll be attacked.”
More than 17,000 job cuts have been tied directly to AI in the first nine months of the year, according to an October report from Challenger, Gray & Christmas. The month of September alone saw 7,000 AI-related job cuts, the report said.
Salesforce CEO Marc Benioff directly attributed the company’s massive reduction in customer service headcount – from 9,000 to about 5,000 – to implementation of AI agents that took over customer conversations.
Amazon slashed 14,000 jobs in October to adopt a leaner structure amid a shift to an AI-driven strategy. The restructure will help the company invest “in our biggest bets and what matters most to our customers’ current and future needs,” Beth Galetti, Amazon’s SVP of people experience and technology, wrote in a blog post.
The proposed federal bill could become a regulatory burden that forces companies to make difficult decisions, including defining what caused particular instances of job loss, according to Atkinson.
“They’ve got to count all that up and then they’ve got to make decisions,” Atkinson said. Companies might need to determine whether job losses were fully or partially tied to AI, Atkinson added.
The bill’s text indicates lawmakers want to better understand the impact of AI on the workforce rather than simply calling out AI-related job losses, Forrester Principal Analyst Alla Valente said.
In addition to the quarterly reports, the Department of Labor would be responsible for creating a more detailed report every other quarter analyzing the net impact of the AI-related job impact reports filed by the companies.
The bill would also require businesses to detail the number of employees hired due to AI incorporation, the number of employees being retrained because of AI and the number of roles going unfilled due to AI, according to the proposal.
“Also, they have to report any new jobs that have been created through AI,” Valente said.
The bill is an “exciting step” that acknowledges AI is having a significant impact on the workforce that, while in some cases is leading to job losses, in other instances is creating new jobs, Valente said.
By the time it’s introduced, Valente said she hopes to see the nine-page bill provide greater details for companies on defining both job loss and creation due to AI.
“This is definitely a step in the right direction,” Valente said. “While AI regulations might be politicized, the impact of AI is non-political. This gives us a foundation to be able to study it in a different way as we start to develop policies, whether those are state or industry, or even maybe federal policy, around AI.”
