How AI is Tearing Through The White-Collar Workforce

Summary

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WSJ What’s News

Episode Title: How AI is Tearing Through The White-Collar Workforce
Date: October 29, 2025
Host: Caitlin McCabe
Guests: Nick Timoros (WSJ Chief Economics Correspondent), Inti Pacheco (WSJ Data Reporter), Chip Cutter (WSJ Workplace Reporter)

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Episode Overview

This episode dives deep into the complex forces reshaping today's white-collar workforce, with a primary focus on how artificial intelligence (AI) is driving corporate layoffs and changing traditional hiring dynamics in major U.S. companies. The segment also covers the latest numbers on global billionaires, the Federal Reserve's decision context amid limited economic data, and brief updates on world news.

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Key Discussion Points & Insights

1. Federal Reserve’s Rate Decision Amid Data Blackout

• The absence of key economic data due to a government shutdown has complicated the Fed's decision-making process and forward guidance.

• Nick Timoros explains that typically, robust data would reconcile disagreements within the rate-setting committee, but with missing jobs reports and other indicators, uncertainty is heightened.

  “Because of the government shutdown, the Fed has been robbed really of the information that would help reconcile this debate. And so that's why this is a weird situation…”
  — Nick Timoros [01:31]

• The market expects a December rate cut, but split opinions remain within the Fed.

  “Once the Fed starts cutting, they need to see a reason to not cut. And certainly the markets are expecting another rate cut in December.”
  — Nick Timoros [03:49]

2. Trump and the Third Term: Political Maneuvering

• President Trump acknowledges constitutional limitations preventing a third term, despite his allies pushing for legal changes.

• There are ongoing moves by certain supporters, including proposed constitutional amendments, to open a more extended run for Trump.

  “‘If you read it, it's pretty clear I'm not allowed to run, adding that, ‘it's too bad.’”
  — Reporting on Trump’s comments [04:32]

3. Billionaire Boom and Market Volatility

• Inti Pacheco details how the U.S. has the highest number of billionaires, primarily due to the technology and AI boom.

  “The technology sector is the one that keeps growing in multiples, and that's been boosted by the recent AI boom.”
  — Inti Pacheco [06:53]

• Europe overtakes Asia as the second top region for billionaires, but volatility means fortunes can vanish quickly.

  "If you have a billion or 2 billion next year, you might not have a billion at all...the way to be sure that you stay a billionaire is you need at least 4.5 billion because market volatility, companies get sold. Things change very quickly."
  — Inti Pacheco [07:26]

4. AI and the White-Collar Workforce: Layoffs and Lean Staffing

• Recent major layoff announcements at Amazon, UPS, Target, and Booz Allen Hamilton are tied, in part, to AI adoption.

• Chip Cutter highlights a shift: companies aim to boost profits without hiring more staff, believing AI can fill the gap.

  "This is an interesting moment in corporate America where many big executives are looking to increase sales, they want to increase profits, but they actually don't want to add any people."
  — Chip Cutter [09:30]

• Executives from JPMorgan Chase, RTX, Goldman Sachs, and Walmart have all expressed intentions to maintain or shrink headcount while pursuing growth.

  "[JPMorgan Chase's CFO] telling investors...the bank has, ‘a very strong bias against having the reflective response to hire more people for any given need.’"
  — Chip Cutter [09:30]

• A cultural shift at companies like Meta, where the AI chief stated:

  "By reducing the size of our team, fewer conversations will be required to make decisions, and each person will be, ‘more load bearing and have more scope.’"
  — Chip Cutter [10:46]

5. Consequences for Employees

• The labor market is tough: few companies are hiring, and those who remain employed are working harder, often doing jobs previously held by multiple people.

• Many workers feel "stuck," with increased responsibilities and little hope for promotion.

  “For employees, this is a really difficult labor market to navigate...those people who have a job are really just looking to hold on. They might be taking on the roles of multiple employees at this point...that's leading many to feel a little bit miserable in the workplace right now.”
  — Chip Cutter [11:23]

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Notable Quotes and Moments

• "If you have a billion or 2 billion next year, you might not have a billion at all."
  — Inti Pacheco [07:26]

• "There's this mood right now across corporate America to just essentially do anything but hire."
  — Chip Cutter [09:30]

• "By reducing the size of our team, fewer conversations will be required to make decisions, and that each person will be, ‘more load bearing.’"
  — Meta AI chief, via Chip Cutter [10:46]

• "Many to feel a little bit miserable in the workplace right now.”
  — Chip Cutter [11:23]

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Timestamps for Key Segments

• [00:57] - [04:25]: Fed Rate Decision with Nick Timoros: Data challenges, divided committee, market expectations
• [04:30] - [06:53]: Trump’s third-term prohibition, political moves, shakeups in DC agencies
• [06:53] - [08:02]: Billionaire statistics, shift in billionaire geographies, volatility
• [08:54] - [11:15]: AI’s role in layoffs, changing corporate staffing philosophy, direct company examples
• [11:15] - [11:58]: Employee reaction and morale, difficult labor market impacts

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Overall Tone and Takeaway

The episode is brisk, factual, and laced with caution regarding the real-world impact of AI on white-collar jobs. While executives tout the efficiency and reduced bureaucracy of smaller teams aided by AI, there's a clear undercurrent of anxiety and difficulty for employees trying to adapt or survive amid rapidly shifting corporate priorities. The discussion threads together macroeconomic policy, rising wealth inequality, and technological disruption, showing how intertwined these issues are in today’s workplace.

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Transcript

[Caitlin McCabe]

Exchanges on navigating macro uncertainty Exchanges on the forces shaping global markets. For the sharpest analysis on finance, business and the economy, count on exchanges. The Goldman Sachs podcast Listen now. It's Fed day, but a bit of an unusual one as the government shutdown leaves officials without their typical data.

[Chip Cutter]

Please.

[Caitlin McCabe]

Plus, why white collar jobs in the US Are vanishing and America leads with the most billionaires worldwide, but no one is safe.

[Inti Pacheco]

The thing is that if you have a billion or 2 billion next year, you might not have a billion at all.

[Caitlin McCabe]

It's Wednesday, October 29th. I'm Caitlin McCabe for the Wall Street Journal and here is the AM edition of what's News, the top headlines and business stories. Moving your world today.

[Chip Cutter]

Foreign.

[Caitlin McCabe]

The Federal Reserve today, which will announce its latest policy decision at 2pm Eastern. Investors widely expect the central bank to cut rates by a quarter percentage point, lowering the target range for the federal funds rate to 3.75% to 4%. The Journal's chief economics correspondent Nick Timoros joins me now to discuss what we might expect from today's meeting. Nick, thanks for being here. We mentioned that a rate cut today seems widely expected. Can you walk us through what the Fed is weighing as it makes this decision today?

[Nick Timoros]

The big question really for this meeting is where does it leave everybody on the rate setting committee in thinking about another interest rate cut in December? Because if we go back to their previous meeting in September, they released quarterly economic projections then, and you had a narrow majority of the 19 people who fill out these projections who thought they would cut rates three times before the end of the year. And there were only three meetings left back in September. So that would imply a cut this week and another cut in December. But you had a significant minority of officials who didn't think any more rate cuts were going to be needed. Now normally when there's this kind of a dividend, the economic data come along and they kind of reconcile the debate. They help the people who were not comfortable with cutting get more comfortable with a cut or vice versa. But Caitlin, because of the government shutdown, the Fed has been robbed really of the information that would help reconcile this debate. And so that's why this is a weird situation where it's gonna be harder for the Fed to have a view about what you're gonna do in December because you won't have had the data that sort of guide you towards wherever that consensus is forming.

[Caitlin McCabe]

Yeah, Nick, you make a great point. Obviously, most notably, we haven't had the September jobs report, which the Fed usually pays close attention to we did have an inflation reading last week via cpi. Is the Fed looking at these more informal indicators or estimates been released in the absence of official macroeconomic data due to the shutdown, or what are they studying as they make this decision?

[Nick Timoros]

The Fed has a view as to how the economy is performing and you're using whatever data you have, whether it's the higher quality government data or sort of the second and third tier private statistics or just anecdote, you're using that to sort of gut check your hypothesis about what's happening in the economy.

[Caitlin McCabe]

What signals might we get or can we expect about the December meeting and even next year?

[Nick Timoros]

The answer for December is really there's inertia built into these processes. So once the Fed starts cutting, they need to see a reason to not cut. And certainly the markets are expecting another rate cut in December. So if that's not how the Fed sees it, then Wednesday's press conference and the likely avalanche of Fed speak next week and after this meeting, that's where you would hear that the Fed just doesn't share the market's view right now about the need to keep cutting interest rates.

[Caitlin McCabe]

That's Journal chief economics correspondent Nick Timiros. Nick, thanks so much for joining us.

[Nick Timoros]

Thanks for having me.

[Caitlin McCabe]

After weeks of speculation among some of his allies about whether he would seek a third term, President Trump acknowledged that the Constitution prohibits him from doing so. While en route to South Korea amid his swing through Asia, Trump told reporters that, quote, if you read it, it's pretty clear I'm not allowed to run, adding that, quote, it's too bad. Trump's comments follow moves by some of his supporters who have promoted the idea of him running in 2028. Former Trump White House chief strategist Steve Bannon has previously said there is a plan in place for Trump to secure a third term. And Andy Ogles, a republic from Tennessee, has introduced a bill that seeks a constitutional amendment which would allow Trump to run again. Meanwhile, the White House has fired all members of the Commission of Fine Arts, an independent federal agency that would be tasked with reviewing some of President Trump's construction projects. A White House official said it is preparing to appoint a new slate of members that are, quote, more aligned with Trump's America first policies. The board members who were fired yesterday were appointed by former President Joe Biden. The commission, which was established by Congress, is charged with giving advice on matters of design that involve federal interests and help maintain the dignity of the nation's capital. Although changes to the White House would be exempt from review processes. Trump has plans for other construction projects as well. The number of billionaires in the world increased last year, with the US Sitting in the top spot, boasting more billionaires than any other country. That's according to wealth intelligence firm Altrada, who found that surging stock markets have left a record world billionaire class of 3,508 individuals, up 10.3% from a year earlier. Now, about a third of the world's billionaires can be found in the US with their fortunes making up 4.43percent of the collective $13.4 trillion in wealth. Journal data. Reporter intypacheco explains why Americans are stacking up so well compared to the rest of the world.

[Inti Pacheco]

From Altrada's analysis, it appears that the technology sector is the one that keeps growing in multiples, and that's been boosted by the recent AI boom, which means more people are becoming billionaires and other billionaires, their wealth just keeps increasing because they're in that sector and a lot of those companies are based in the US which kind of explains what's going on.

[Caitlin McCabe]

However, Inti added that hitting the billionaire mark doesn't mean the world's wealthiest can rest easy.

[Inti Pacheco]

Europe became the second largest region in terms of the billionaire count just this year. It used to be Asia, but apparently some people have fallen off the list. The thing is that if you have a billion or 2 billion next year, you might not have a billion at all. All Charda says that the way to be sure that you stay a billionaire is you need at least 4.5 billion because market volatility companies get sold. Things change very quickly. So from one year to another you might not be a billionaire anymore.

[Caitlin McCabe]

To find out more, we've left a link to Inti's [e-mail] in our show notes. Coming up, we explore what some of America's biggest companies are saying about hiring in the age of AI, or rather why they're choosing to not hire at all. That story and more after the break.

[Chip Cutter]

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[Caitlin McCabe]

It'S been a tough month for the white collar workforce with layoffs announced at a range of companies including Amazon, United Parcel Service, Target and Booz Allen Hamilton. At least in some cases, part of the layoffs are being driven by companies embrace of AI which Executives hope can handle more of the work that well compensated corporate workers have been doing. The Journal's Chip Cutter covers workplace and management issues. He says that companies are increasingly calculating that they can keep the size of their teams flat or shrink them through layoffs without harming their businesses.

[Chip Cutter]

This is an interesting moment in corporate America where many big executives are looking to increase sales, they want to increase profits, but they actually don't want to add any people. And there's this experiment of sorts underway at the moment to see whether that's going to be possible. And what's behind this is a belief that artificial intelligence, that AI, will be able to fill a lot of the gaps, even if more people aren't added inside of an organization. And you hear this from just a number of comments from large company executives. So it was JP Morgan Chase's CFO telling investors recently that the bank now has, quote, a very strong bias against having the reflective response to hire more people for any given need. The aerospace and defense company RTX boasted last week that its sales rose even without adding employees. Goldman Sachs sent a memo to people inside the firm saying that it'll continue to constrain headcount. And then you have Walmart, which is the nation's largest private employer, saying that it plans to keep its headcount flat over the next three years, even as it grows. And so there's this mood right now across corporate America to just essentially do anything but hire.

[Caitlin McCabe]

Chip added that some companies say leaner workforces will make them more efficient by cutting down on bureaucracy.

[Chip Cutter]

Some actually say that they think they'll do better with smaller organizations. There was a memo sent last week inside Meta where the company's AI chief actually said that by reducing the size of our team, fewer conversations will be required to make decisions, and that each person will be, quote, more load bearing and have more scope. So this feeling that actually bureaucracy is getting in the way of progress, that bigger teams are getting in the way of companies advancing, is out there too.

[Caitlin McCabe]

But Chip says while executives say the changes are good for their companies, employees aren't necessarily feeling the same way.

[Chip Cutter]

For employees, this is a really difficult labor market to navigate. If you're out of work and looking for a job, it's oftentimes difficult to get people to respond to you to find one. Many big companies are not hiring right now. At the same time, those people who have a job are really just looking to hold on. They might be taking on the roles of multiple employees at this point. They may not be being promoted. They may just sort of feel stuck in place with more responsibilities put on them. And that's leading many to feel a little bit miserable in the workplace right now. Foreign.

[Caitlin McCabe]

We go now to the Middle east where the Israeli military said today it would return to upholding a ceasefire in Gaza after launching dozens of airstrikes in what it said was retaliation for Hamas violations of the peace deal. Yesterday, Israeli Prime Minister Benjamin Netanyahu said he ordered forceful strikes on the Gaza Strip in retaliation for what the military said was a Hamas attack on troops stationed in in Israeli controlled territory in southern Gaza. The military said one person was killed in the shooting. Israel said it targeted 30 combatants. The Palestinian Red Crescent Society said they received nine dead and treated dozens of people for injuries. And Hurricane Melissa made landfall in Cuba early this morning with meteorologists calling it extremely dangerous despite slowing to a Category 3 storm. It comes a day after the hurricane hit Jamaica as one of the most powerful Atlantic storms on record. Jamaican officials said the storm has trapped families in homes, damaged hospitals and cut power for three quarters of the island. Jamaica's government had reported at least three storm related deaths on Monday before the hurricane's direct hit on the country. Before we go, heads up, we made a correction to last night's episode. OpenAI's nonprofit parent owns a stake in its for profit subsidiary, which has become a public benefit corporation. An earlier version of that episode incorrectly said OpenAI had become a for profit company. And that's it for what's news for this Wednesday morning. Today's show is produced by Kate Bullivant. Our supervising producer was Michael Cosmides. And I'm Caitlin McCabe for the Wall Street Journal. We'll be back tonight with a new show. Until then, thanks for listening.

[Chip Cutter]

Sam.