Amid a sweeping wave of AI-favoured corporate restructurings and layoffs, California has become the first U.S. state to order a state action plan aimed at shielding its workforce and small businesses against the ongoing “AI disruption”.
On Thursday, California Governor Gavin Newsom signed an executive order directing state agencies, labor leaders, economists, and members of the tech ecosystem to start knitting safety nets before the ongoing automation drive triggers more layoffs in the state.
Here’s what California plans
The aim of this executive order is to ensure that the wealth generated by AI growth is shared with the minds that are creating and training the technology.
“This moment demands that we reimagine the entire system — how we work, how we govern, how we prepare people for the future,” Newsom said. “California has never sat back and watched as the future happened to us – and we won’t start now.”
Under the order, state agencies including its finance and labor departments must provide academic researches assessing the foreseeable impact of AI on the broader working ecosystems. A 90-day time period — that would fall in August — has been alloted for the completion of this research work.
Similarly, California’s Labor and Workforce Development Agency has been asked to suggest amendments to the Worker Adjustment and Retraining Notification Act in the next 180 days, which means around November this year.
The Employment Development Department has been given until October 15 to complete a strategic review on how a collective voice could louden worker voices in the thick of the rapidly ongoing AI adoption.
“California is committed to understanding AI’s impacts on workers, modernizing workforce training, and expanding pathways into the jobs of the future so more Californians are set up for success,” Newson noted.
In recent months, a flurry of tech firms announced massive layoffs citing AI-focussed redirection and expenditure allocations. California has now decided to track its workforce metrics. More than 92,000 tech workers have reportedly lost jobs as of April 2026, mainly to the AI influx.
Source: Layoffs.fyi
Legal provisions to flag early warning signs of tech-induced downsizing will be chalked up in the state, as per the newly signed Governor’s executive order. Under this measure, the state will introduce an AI impact dashboard as a public tracker monitoring the shift in human employment stats as automation makes deeper corporate inroads.
California is launching Monthly Tech Audits integrated into the state’s official jobs report to see how employers utilize technology in making hiring and payroll decisions. The data will be wired into “The AI Job Playbook” which will help dislocated workers toward emerging technical fields and high-growth industries.
State of AI regulations
Unfortunately, the growth of AI development is nowhere in proportion to the legal guardrails that makes it a safe bet for the humans that are creating it.
Incidentally, Governor Newsom’s step to prepare a state-action plan to tackle the negative impacts of the AI growth comes on the same day as U.S. President Trump deciding to scrap the signing of an executive order focussed on AI regulations.
“I didn’t like certain aspects of it. I postponed it. I think it gets in the way of, you know, we’re leading China, we’re leading everybody, and I don’t want to do anything that’s going to get in the way of that,” the President was quoted as saying.
The development has sparked criticizm and outrage against the White House, which until recently, was talking about vetting AI models before commercializing them.
The U.K., meanwhile, has instructed existing regulators to oversee AI within their own industries.
