California Governor Gavin Newsom just signed an executive order directing state agencies to prepare for potential workforce disruption caused by artificial intelligence.
The order brings together labor groups, economists, universities, and industry leaders to study AI’s impact on jobs and develop policies aimed at helping workers and businesses adapt, according to Gov. Newsom’s Office.
California Prepares for AI Job Disruption
The state will explore policies including severance standards, employment insurance support, workforce retraining, worker ownership models, and stronger tracking of hiring and payroll trends tied to AI adoption.
California will also create a new dashboard tracking AI’s impact across industries and review potential updates to the state’s WARN Act within 180 days to improve early warning systems around layoffs and labor disruption.
The order also calls for expanded AI training in higher education and updated job training programs for displaced workers.
Focus on Workers and Small Businesses
State agencies were directed to study ways workers could benefit from AI-driven productivity gains, including employee ownership structures and other compensation models.
California will also explore programs aimed at helping small businesses adopt AI tools while supporting workforce retention.
Other initiatives include a centralized online platform for government services and expanded support for long-term unemployed workers.
California Expands AI Policy Efforts
The order builds on California’s broader AI policy push. According to the governor’s office, 33 of the world’s top 50 private AI companies are based in California.
Since 2023, the state has introduced AI-related policies covering generative AI, deepfakes, AI watermarking, performer likeness protections, and online safety measures.
California also announced a statewide public engagement initiative called Engaged California to gather public input on AI’s impact on work and the economy.
