CA eyes AI regulation as Newsom orders new workforce protections amid job shifts, mass layoffs

SAN FRANCISCO (KGO) -- California is moving to lead on artificial intelligence regulation as experts warn the technology will both displace and create jobs, bringing rapid disruption to the workforce.

"Government has a role to play in trying to ease the transition to the AI economy. It seems to be coming fast and furious," said Stanford Law professor Nate Persily, a legal scholar and AI policy expert. "Politicians around the country are paying attention to the implications of AI for the economy and, in particular, employment. And so it's not surprising that California, which is home to the nation's AI industry, is trying to be a leader in addressing the labor impacts of AI."

The shifting landscape is already visible in the tech sector. Meta has sent layoff notices to about 8,000 employees, roughly 10% of its staff, amid ongoing AI changes.

Gov. Gavin Newsom addressed the uncertainty Tuesday at a policy conference in Maryland.

"We ain't seen nothing yet, because now it's the bluecollar worker that sounds a lot like 25yearold whitecollar workers that I see in San Francisco who are wondering why they're not getting a call back on a job interview," Newsom said.

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"I think the jury is still out as to whether AI is on net going to cost jobs or create more jobs," Persily said. "But we know that it's going to disrupt the economy and that it's going to change employment in the future. There are jobs that exist today that will be replaced by AI, and there are jobs that we can't even think of that will be created by AI."

On Thursday, Newsom signed an executive order aimed at preparing the state for an AIdriven economy. The order calls for a new state dashboard to track AI's impact on jobs, explores potential changes to layoff laws, and proposes expanded worker protections and safety rules. It also outlines early steps toward giving workers a financial stake in their companies.

"Universal basic income? We don't need charity, we need ownership. It's universal basic capital," Newsom said. "By the way, those are the creators telling me that - not just me. This is Sam Altman, Dario and others," he added, referring to OpenAI cofounder Sam Altman and Anthropic cofounder Dario Amodei.

Persily, who coauthored the book Artificial Intelligence, Politics and Political Science, called the order admirable and important but cautioned that regulating the technology poses significant challenges.

"Every time a government drafts a law, it seems to be outdated two months later. And so this is an incredibly difficult area to regulate," he said.

MORE: Meta sends out layoff notices to 8,000 employees as it cuts 10% of staff amid AI changes

A key component of the order focuses on workforce training. The state plans to expand jobtraining programs and build AI skills among current workers and young people entering the workforce.

Persily said he remains optimistic about AI's longterm impact on employment.

"I am optimistic that AI is going to create a whole new category of jobs that we haven't even thought of yet. And it really just depends on the diffusion of AI into the economy," he said. "There are so many needs that are unmet that I think AI will be able to address."

The order also highlights support for small businesses and communities.

"I think there are going to be small businesses that thrive because of the AI revolution," Persily said. "And the question is, how can you use AI to increase productivity of existing workers and provide new jobs for those who are going to be displaced by the disruption? Government is necessarily going to have a role to play, if for no other reason than that they are in the best position to educate the future workers for that new economy."