Is AI the Reason for Your Layoff? New York Becomes the First State to Require Companies to Disclose If So. It's the first official statewide move towards understanding AI's effect on the labor market.
By Sherin Shibu Edited by Melissa Malamut
Key Takeaways
- As regulators grow more concerned about AI’s impact on the labor market, New York State is requiring companies to disclose if AI is the reason for the layoffs.
- New York is the first (and so far only) state to add the AI disclosure to its system.
New York is taking an unprecedented step by asking companies to disclose whether artificial intelligence is the reason for their layoffs.
The move applies to New York State's existing Worker Adjustment and Retraining Notification (WARN) system and took effect in March, Bloomberg reported. New York is the first state in the U.S. to add the disclosure, which could help regulators understand AI's effects on the labor market.
The change takes the form of a checkbox added to a form employers fill out at least 90 days before a mass layoff or plant closure through the WARN system. Companies have to select whether "technological innovation or automation" is a reason for job cuts. If they choose that option, they are directed to a second menu where they are asked to name the specific technology responsible for layoffs, like AI or robots.
Related: Morgan Stanley Plans to Lay Off 2,000 Workers, Replacing Some with AI
New York Governor Kathy Hochul first proposed the change in her January 2025 State of the State address.
At the time of writing, no companies filing WARN notices in the state have said the layoffs were due to AI.
So far, no other states have followed New York's lead in adding the AI disclosure to their WARN notices, but some experts suggest "it signals growing concern among regulators," one CEO told Bloomberg.
Related: AI Is Dramatically Decreasing Entry-Level Hiring at Big Tech Companies, According to a New Analysis
There is increasing concern about AI's effect on the labor market. Last month, Anthropic CEO Dario Amodei predicted that AI would wipe out half of all entry-level, white-collar jobs within the next five years and cause unemployment to rise 20%.
In March, Amodei said that AI would take over all coding for software engineers within a year.
Meanwhile, Victor Lazarte, general partner at venture capital firm Benchmark, said in April that AI was "fully replacing people" in professions like law and recruitment. He predicted that AI would automate routine tasks and take over entry-level jobs.
