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The AI jobs apocalypse isn’t upon us, according to new data

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Hello and welcome to Eye on AI. In this edition: No AI Jobpocalypse, plus early signs of life for entry-level jobs…OpenAI launches Sora 2…Meta plans to use AI chatbot conversations to personalize ads…and more companies are disclosing AI-related risks.

Hi, Beatrice Nolan here, filling in for AI reporter Sharon Goldman, who is out today. For all the corporate hype and Silicon Valley hand-wringing, new research suggests that the U.S. jobs market hasn’t yet experienced the AI apocalypse some have warned about.

In a new report, researchers from Yale’s Budget Lab and the Brookings Institution said they had found no evidence of any “discernible disruption” to jobs since the launch of OpenAI’s ChatGPT in November 2022. The study found that most of the ongoing shifts in the U.S. occupational mix, a measure of the types of jobs people hold, were already underway in 2021, and recent changes don’t appear any more dramatic.

“While the occupational mix is changing more quickly than it has in the past, it is not a large difference and predates the widespread introduction of AI in the workforce,” the researchers wrote in the report. “Currently, measures of exposure, automation, and augmentation show no sign of being related to changes in employment or unemployment.”

Industries with higher AI exposure, such as Information, Financial Activities, and Professional and Business Services, have seen some downward shifts, but these trends largely began before ChatGPT’s launch.

The conclusion isn’t altogether shocking, although it flies in the face of some of the AI doomsayers’ more dramatic claims. Historically, major workplace disruptions have unfolded over decades, not months or years. Computers, for example, didn’t become common in offices until nearly 10 years after their debut, and it was even longer before they reshaped workflows. If AI ends up transforming the labor market as dramatically as computers did—or more so—it’s reasonable to expect that broad effects will take longer than three years to appear.

Some executives have also told me they are taking a “wait and see” approach to hiring while they assess whether the tech can really deliver on its productivity promises. This approach can slow hiring and make the labor market feel sluggish, but it doesn’t necessarily mean workers are being automated out of their jobs.

While anxiety over the effects of AI on today’s labor market may be widespread, the new data suggests that this anxiety is still largely speculative. 

Entry-level hiring woes

The real hiring pain has been felt by college grads and entry-level workers.

There’s no denying that AI is better at tasks typically done by this class of workers, and companies have increasingly been saying the quiet part out loud when it comes to junior roles. But claims that AI is keeping recent graduates out of work aren’t entirely supported by the new data. When researchers compared jobless rates for recent graduates to those with more experience, new grads seemed to be having a slightly tougher time landing roles, but the gap wasn’t big enough to suggest technology is the main factor.

The researchers found a small increase in occupational dissimilarity compared to older graduates, which could reflect early AI effects but also could just as easily be attributed to labor market trends, including employers’ and job-seekers’ reactions to noise about AI replacing workers. The report suggests that entry-level struggles are more likely to be part of broader labor market dynamics rather than a direct result of AI adoption.

Recently, there have also been anecdotal but promising signs of life in the entry-level job market. For example, Shopify and Cloudflare are both increasing their intern intake this year, with Cloudflare calling AI tools a way “to multiply how new hires can contribute to a team” rather than a replacement for the new hires themselves. Younger workers are typically more receptive, more eager to experiment, and more creative when it comes to using emerging technology, which could give companies that hire them an edge. As U.K.-based programmer Simon Willison put it: “An intern armed with AI tools can produce value a whole lot faster than interns in previous years.”

The researchers cautioned that the analysis isn’t predictive, and they plan to keep updating their findings. They also warned that the sample size is small.

Just because AI hasn’t significantly impacted the labor market yet doesn’t mean it won’t in the future. Some recent assessments, such as OpenAI’s new GDPval benchmark, show that leading AI models are getting better at performing professional tasks at or above human expert level on roughly half of cases, depending on the sector. As AI tools improve and companies get better at integrating them, the tech could have a more direct impact on the workforce.

But should we be thinking of AI as just the next computer, or as a new industrial revolution? At least for now, the jury’s still out.

With that, here’s the rest of the AI news.

Beatrice Nolan
bea.nolan@fortune.com
@beafreyanolan

FORTUNE ON AI

We’re not in an ‘AI winter’—but here’s how to survive a cold snap —by Sharon Goldman

California governor signs landmark AI safety law, forcing major tech companies to disclose protocols and protect whistleblowers —Beatrice Nolan

How OpenAI and Stripe’s latest move could blow up online shopping as we know it —by Sharon Goldman

Meta is exploiting the ‘illusion of privacy’ to sell you ads based on chatbot conversations, top AI ethics expert says—and you can’t opt out —Eva Roytburg

AI IN THE NEWS

Meta plans to use AI chatbot conversations to personalize ads. Meta will begin using chats with its AI assistant to shape ads and content recommendations across Facebook and Instagram. The company announced the update to its recommendation system on Wednesday, adding it will take effect on Dec. 16, with user notifications beginning Oct. 7. The company told the Wall Street Journal that it will not use conversations about religion, politics, sexual orientation, health, or race and ethnicity to personalize ads or content. The move will tie Meta’s massive investments in generative AI into its core ad business. Users can’t opt out, but those who don’t use Meta AI won’t be affected, according to the Journal.

Mira Murati’s Thinking Machines Lab launches its first product. Thinking Machines, an AI lab lead by former OpenAI CTO Mira Murati, has launched a tool that automates the creation of custom frontier AI models. Murati told Wired the tool, called Tinker, “will help empower researchers and developers to experiment with models and will make frontier capabilities much more accessible to all people.” The team believes that giving users the tools to fine-tune frontier models will demystify the process of model tuning, make advanced AI accessible beyond big labs, and help to unlock specialized capabilities in areas like math, law, or medicine. The startup raised $2 billion in seed funding in July 2025, before releasing any products, and is made up of a team of top researchers including John Schulman, who cofounded OpenAI and led the creation of ChatGPT. Read more from Wired.

OpenAI launches a new version of Sora. OpenAI has launched Sora 2, its next-generation AI video and audio model, along with a companion app that lets users create, share, and remix AI-generated videos. The new model improves photorealistic motion, generates speech, and introduces “cameos,” allowing users to insert themselves into videos via a short verification recording. However, according to the Wall Street Journal, the new video generator requires copyright holders to opt out. This means that movie studios and other IP owners must actively request that OpenAI exclude their copyrighted material from videos generated by the new version of Sora. A later report from 404 Media found that users are able to generate strange and often offensive content featuring copyrighted characters like Pikachu, SpongeBob SquarePants, and figures from The Simpsons. Read more from 404 Media here.

A new startup is scooping up top AI researchers. Periodic Labs, a new San Francisco startup founded by ChatGPT co-creator Liam Fedus and former DeepMind scientist Ekin Dogus Cubuk, has recruited a string of top AI researchers from OpenAI, Google DeepMind, and Meta, according to the New York Times. More than 20 researchers, including Rishabh Agarwal, who was poached by Meta from DeepMind just a few months ago, have left their work at major AI companies to join the startup focused on building AI that accelerates real-world scientific discovery in physics, chemistry, and materials science. It’s backed by $300 million in funding and plans to use robots to run large-scale lab experiments. Read more from the New York Times.

AI CALENDAR

Oct. 6-10: World AI Week, Amsterdam.

Oct. 21-22: TedAI San Francisco.

Nov. 10-13: Web Summit, Lisbon. 

Nov. 26-27: World AI Congress, London.

Dec. 2-7: NeurIPS, San Diego.

Dec. 8-9: Fortune Brainstorm AI San Francisco. Apply to attend here.

EYE ON AI NUMBERS

72% 

That’s the percentage of S&P 500 companies that have disclosed an AI-related risk this year, according to The Conference Board, a nonprofit think tank and business membership organization, and ESGAUGE, a data analytics firm. Public company disclosure of AI as a material risk has surged in the past two years, with the share of  S&P 500 companies citing an AI-related risk jumping from 12% in 2023 to 72% this year.

Reputational risk is the most frequently cited concern around AI, disclosed by 38% of companies in 2025. Cybersecurity was a close second, cited by 20% of firms in both 2024 and 2025. While all sectors are disclosing risks, financial, health care, and industrials have seen the sharpest rise. This may be because financial and health care companies face regulatory risks tied to sensitive data and fairness, while industrials are largely scaling automation and robotics.

“The rise in AI-related risk disclosures reflects the rapid mainstreaming of AI across corporate functions in recent years, as companies embed it more deeply into areas such as supply chains, customer engagement, and product development,” Andrew Jones, principal researcher at The Conference Board, told Fortune. “With adoption expanding, firms have increased their internal focus on governance, compliance, and operational considerations, with boards, risk committees, and legal teams evaluating potential challenges from data privacy and bias to regulatory uncertainty and liability.” 

The dramatic surge in disclosures does signal that more companies are seeing AI integration as a material risk that needs to be actively managed and communicated to investors. The findings were based on Form 10-K filings from S&P 500 companies available through Aug. 15, 2025.



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Senate Dems’ plan to fix Obamacare premiums adds nearly $300 billion to deficit, CRFB says

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December 5, 2025

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The Committee for a Responsible Federal Budget (CRFB) is a nonpartisan watchdog that regularly estimates how much the U.S. Congress is adding to the $38 trillion national debt.

With enhanced Affordable Care Act (ACA) subsidies due to expire within days, some Senate Democrats are scrambling to protect millions of Americans from getting the unpleasant holiday gift of spiking health insurance premiums. The CRFB says there’s just one problem with the plan: It’s not funded.

“With the national debt as large as the economy and interest payments costing $1 trillion annually, it is absurd to suggest adding hundreds of billions more to the debt,” CRFB President Maya MacGuineas wrote in a statement on Friday afternoon.

The proposal, backed by members of the Senate Democratic caucus, would fully extend the enhanced ACA subsidies for three years, from 2026 through 2028, with no additional income limits on who can qualify. Those subsidies, originally boosted during the pandemic and later renewed, were designed to lower premiums and prevent coverage losses for middle‑ and lower‑income households purchasing insurance on the ACA exchanges.

CRFB estimated that even this three‑year extension alone would add roughly $300 billion to federal deficits over the next decade, largely because the federal government would continue to shoulder a larger share of premium costs while enrollment and subsidy amounts remain elevated. If Congress ultimately moves to make the enhanced subsidies permanent—as many advocates have urged—the total cost could swell to nearly $550 billion in additional borrowing over the next decade.

Reversing recent guardrails

MacGuineas called the Senate bill “far worse than even a debt-financed extension” as it would roll back several “program integrity” measures that were enacted as part of a 2025 reconciliation law and were intended to tighten oversight of ACA subsidies. On top of that, it would be funded by borrowing even more. “This is a bad idea made worse,” MacGuineas added.

The watchdog group’s central critique is that the new Senate plan does not attempt to offset its costs through spending cuts or new revenue and, in their view, goes beyond a simple extension by expanding the underlying subsidy structure.

The legislation would permanently repeal restrictions that eliminated subsidies for certain groups enrolling during special enrollment periods and would scrap rules requiring full repayment of excess advance subsidies and stricter verification of eligibility and tax reconciliation. The bill would also nullify portions of a 2025 federal regulation that loosened limits on the actuarial value of exchange plans and altered how subsidies are calculated, effectively reshaping how generous plans can be and how federal support is determined. CRFB warned these reversals would increase costs further while weakening safeguards designed to reduce misuse and error in the subsidy system.

MacGuineas said that any subsidy extension should be paired with broader reforms to curb health spending and reduce overall borrowing. In her view, lawmakers are missing a chance to redesign ACA support in a way that lowers premiums while also improving the long‑term budget outlook.

The debate over ACA subsidies recently contributed to a government funding standoff, and CRFB argued that the new Senate bill reflects a political compromise that prioritizes short‑term relief over long‑term fiscal responsibility.

“After a pointless government shutdown over this issue, it is beyond disappointing that this is the preferred solution to such an important issue,” MacGuineas wrote.

The off-year elections cast the government shutdown and cost-of-living arguments in a different light. Democrats made stunning gains and almost flipped a deep-red district in Tennessee as politicians from the far left and center coalesced around “affordability.”

Senate Minority Leader Chuck Schumer is reportedly smelling blood in the water and doubling down on the theme heading into the pivotal midterm elections of 2026. President Donald Trump is scheduled to visit Pennsylvania soon to discuss pocketbook anxieties. But he is repeating predecessor Joe Biden’s habit of dismissing inflation, despite widespread evidence to the contrary.

“We fixed inflation, and we fixed almost everything,” Trump said in a Tuesday cabinet meeting, in which he also dismissed affordability as a “hoax” pushed by Democrats.​

Lawmakers on both sides of the aisle now face a politically fraught choice: allow premiums to jump sharply—including in swing states like Pennsylvania where ACA enrollees face double‑digit increases—or pass an expensive subsidy extension that would, as CRFB calculates, explode the deficit without addressing underlying health care costs.



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Netflix–Warner Bros. deal sets up $72 billion antitrust test

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December 5, 2025

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Netflix Inc. has won the heated takeover battle for Warner Bros. Discovery Inc. Now it must convince global antitrust regulators that the deal won’t give it an illegal advantage in the streaming market. 

The $72 billion tie-up joins the world’s dominant paid streaming service with one of Hollywood’s most iconic movie studios. It would reshape the market for online video content by combining the No. 1 streaming player with the No. 4 service HBO Max and its blockbuster hits such as Game Of Thrones, Friends, and the DC Universe comics characters franchise.  

That could raise red flags for global antitrust regulators over concerns that Netflix would have too much control over the streaming market. The company faces a lengthy Justice Department review and a possible US lawsuit seeking to block the deal if it doesn’t adopt some remedies to get it cleared, analysts said.

“Netflix will have an uphill climb unless it agrees to divest HBO Max as well as additional behavioral commitments — particularly on licensing content,” said Bloomberg Intelligence analyst Jennifer Rie. “The streaming overlap is significant,” she added, saying the argument that “the market should be viewed more broadly is a tough one to win.”

By choosing Netflix, Warner Bros. has jilted another bidder, Paramount Skydance Corp., a move that risks touching off a political battle in Washington. Paramount is backed by the world’s second-richest man, Larry Ellison, and his son, David Ellison, and the company has touted their longstanding close ties to President Donald Trump. Their acquisition of Paramount, which closed in August, has won public praise from Trump. 

Comcast Corp. also made a bid for Warner Bros., looking to merge it with its NBCUniversal division.

The Justice Department’s antitrust division, which would review the transaction in the US, could argue that the deal is illegal on its face because the combined market share would put Netflix well over a 30% threshold.

The White House, the Justice Department and Comcast didn’t immediately respond to requests for comment. 

US lawmakers from both parties, including Republican Representative Darrell Issa and Democratic Senator Elizabeth Warren have already faulted the transaction — which would create a global streaming giant with 450 million users — as harmful to consumers.

“This deal looks like an anti-monopoly nightmare,” Warren said after the Netflix announcement. Utah Senator Mike Lee, a Republican, said in a social media post earlier this week that a Warner Bros.-Netflix tie-up would raise more serious competition questions “than any transaction I’ve seen in about a decade.”

European Union regulators are also likely to subject the Netflix proposal to an intensive review amid pressure from legislators. In the UK, the deal has already drawn scrutiny before the announcement, with House of Lords member Baroness Luciana Berger pressing the government on how the transaction would impact competition and consumer prices.

The combined company could raise prices and broadly impact “culture, film, cinemas and theater releases,”said Andreas Schwab, a leading member of the European Parliament on competition issues, after the announcement.

Paramount has sought to frame the Netflix deal as a non-starter. “The simple truth is that a deal with Netflix as the buyer likely will never close, due to antitrust and regulatory challenges in the United States and in most jurisdictions abroad,” Paramount’s antitrust lawyers wrote to their counterparts at Warner Bros. on Dec. 1.

Appealing directly to Trump could help Netflix avoid intense antitrust scrutiny, New Street Research’s Blair Levin wrote in a note on Friday. Levin said it’s possible that Trump could come to see the benefit of switching from a pro-Paramount position to a pro-Netflix position. “And if he does so, we believe the DOJ will follow suit,” Levin wrote.

Netflix co-Chief Executive Officer Ted Sarandos had dinner with Trump at the president’s Mar-a-Lago resort in Florida last December, a move other CEOs made after the election in order to win over the administration. In a call with investors Friday morning, Sarandos said that he’s “highly confident in the regulatory process,” contending the deal favors consumers, workers and innovation. 

“Our plans here are to work really closely with all the appropriate governments and regulators, but really confident that we’re going to get all the necessary approvals that we need,” he said.

Netflix will likely argue to regulators that other video services such as Google’s YouTube and ByteDance Ltd.’s TikTok should be included in any analysis of the market, which would dramatically shrink the company’s perceived dominance.

The US Federal Communications Commission, which regulates the transfer of broadcast-TV licenses, isn’t expected to play a role in the deal, as neither hold such licenses. Warner Bros. plans to spin off its cable TV division, which includes channels such as CNN, TBS and TNT, before the sale.

Even if antitrust reviews just focus on streaming, Netflix believes it will ultimately prevail, pointing to Amazon.com Inc.’s Prime and Walt Disney Co. as other major competitors, according to people familiar with the company’s thinking. 

Netflix is expected to argue that more than 75% of HBO Max subscribers already subscribe to Netflix, making them complementary offerings rather than competitors, said the people, who asked not to be named discussing confidential deliberations. The company is expected to make the case that reducing its content costs through owning Warner Bros., eliminating redundant back-end technology and bundling Netflix with Max will yield lower prices.



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The rise of AI reasoning models comes with a big energy tradeoff

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December 5, 2025

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Nearly all leading artificial intelligence developers are focused on building AI models that mimic the way humans reason, but new research shows these cutting-edge systems can be far more energy intensive, adding to concerns about AI’s strain on power grids.

AI reasoning models used 30 times more power on average to respond to 1,000 written prompts than alternatives without this reasoning capability or which had it disabled, according to a study released Thursday. The work was carried out by the AI Energy Score project, led by Hugging Face research scientist Sasha Luccioni and Salesforce Inc. head of AI sustainability Boris Gamazaychikov.

The researchers evaluated 40 open, freely available AI models, including software from OpenAI, Alphabet Inc.’s Google and Microsoft Corp. Some models were found to have a much wider disparity in energy consumption, including one from Chinese upstart DeepSeek. A slimmed-down version of DeepSeek’s R1 model used just 50 watt hours to respond to the prompts when reasoning was turned off, or about as much power as is needed to run a 50 watt lightbulb for an hour. With the reasoning feature enabled, the same model required 7,626 watt hours to complete the tasks.

The soaring energy needs of AI have increasingly come under scrutiny. As tech companies race to build more and bigger data centers to support AI, industry watchers have raised concerns about straining power grids and raising energy costs for consumers. A Bloomberg investigation in September found that wholesale electricity prices rose as much as 267% over the past five years in areas near data centers. There are also environmental drawbacks, as Microsoft, Google and Amazon.com Inc. have previously acknowledged the data center buildout could complicate their long-term climate objectives. 

More than a year ago, OpenAI released its first reasoning model, called o1. Where its prior software replied almost instantly to queries, o1 spent more time computing an answer before responding. Many other AI companies have since released similar systems, with the goal of solving more complex multistep problems for fields like science, math and coding.

Though reasoning systems have quickly become the industry norm for carrying out more complicated tasks, there has been little research into their energy demands. Much of the increase in power consumption is due to reasoning models generating much more text when responding, the researchers said. 

The new report aims to better understand how AI energy needs are evolving, Luccioni said. She also hopes it helps people better understand that there are different types of AI models suited to different actions. Not every query requires tapping the most computationally intensive AI reasoning systems.

“We should be smarter about the way that we use AI,” Luccioni said. “Choosing the right model for the right task is important.”

To test the difference in power use, the researchers ran all the models on the same computer hardware. They used the same prompts for each, ranging from simple questions — such as asking which team won the Super Bowl in a particular year — to more complex math problems. They also used a software tool called CodeCarbon to track how much energy was being consumed in real time.

The results varied considerably. The researchers found one of Microsoft’s Phi 4 reasoning models used 9,462 watt hours with reasoning turned on, compared with about 18 watt hours with it off. OpenAI’s largest gpt-oss model, meanwhile, had a less stark difference. It used 8,504 watt hours with reasoning on the most computationally intensive “high” setting and 5,313 watt hours with the setting turned down to “low.” 

OpenAI, Microsoft, Google and DeepSeek did not immediately respond to a request for comment.

Google released internal research in August that estimated the median text prompt for its Gemini AI service used 0.24 watt-hours of energy, roughly equal to watching TV for less than nine seconds. Google said that figure was “substantially lower than many public estimates.” 

Much of the discussion about AI power consumption has focused on large-scale facilities set up to train artificial intelligence systems. Increasingly, however, tech firms are shifting more resources to inference, or the process of running AI systems after they’ve been trained. The push toward reasoning models is a big piece of that as these systems are more reliant on inference.

Recently, some tech leaders have acknowledged that AI’s power draw needs to be reckoned with. Microsoft CEO Satya Nadella said the industry must earn the “social permission to consume energy” for AI data centers in a November interview. To do that, he argued tech must use AI to do good and foster broad economic growth.



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