(Inside California Politics) — As generative artificial intelligence threatens to disrupt California’s economy, Gov. Gavin Newsom is preparing for upheaval in the state’s labor market.
The governor released an executive order Thursday containing more than a dozen directives for state agencies aimed at protecting workers from changes some warn could lead to devastating job losses.
Newsom said the situation requires a reimagination of the “entire system,” from work to governance.
“California has never sat back and watched as the future happened to us — and we won’t start now,” Newsom said in a statement. “We have taken the lead on advancing innovation, safety and transparency. But we must think bigger.”
Critics and supporters of AI alike have suggested that the burgeoning technology could massively threaten the country’s current economic structure. Those voices include Anthropic CEO Dario Amodei, who told Axios that AI could drive unemployment to 10-20% and eliminate half of the country’s entry-level white-collar jobs by the end of the decade.
Newsom wants the Golden State to take those threats seriously. Earlier this year, he floated the idea of Universal Basic Capital, a strategy that could give Californians financial stakes in the booming economy that could simultaneously threaten their jobs.
During a chat with Bloomberg in January, the governor said he was hoping to unveil a plan in May or June.
“Not universal basic income — [that’s] the old construct — but this notion of universal basic capital,” Newsom said at the time.
He compared the concept to that of a sovereign wealth fund, adding that it is “more challenging than it appears.”
“I’ve been working to try to figure a version of that out,” Newsom said.
The administration again mentioned the concept Thursday, and his office said the executive order directs agencies to “empower workers and help them share in the gains made from AI adoptions.”
The order suggests several additional areas of major policy change, including supporting the creation of or conversion to employee-owned companies. Newsom’s order also indicates the potential for expansions of the California Service Corps and Corps to Careers programs, which could provide work relief and retraining to workers affected by AI-induced job losses.
Other parts of the order are more administrative, including directing the Employment Development Department to develop new strategies to help unemployed workers to launch a dashboard showing the impacts of AI on employment in different industries.
The governor’s office says the executive order is another step in the state’s leadership on AI policy and encouraged Californians to weigh in through the Engaged California platform.
“Today is just the first step as we rewrite policy and direction, creating a future of work that works for all,” Newsom said.
The order already has support from some lawmakers, like Asm. Rebecca Bauer Kahan, D-Orinda, who thanked the governor for acknowledging the “profound disruption” that AI will cause.
“This executive order is a meaningful first step, but studies and reports are just the beginning of what is needed to protect California’s workers,” she told FOX40 in a statement. “I am confident that we will continue to work together to run this framework into essential protections our workers deserve in order for them to thrive in a future shaped by AI.”
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