As recent college graduates face one of the toughest job markets in years, Berkeley economist and voluble Substacker Brad DeLong has a message for those struggling to land their first full-time gig: Artificial intelligence (AI) and automation are not to blame. Larger forces are at work.

DeLong, a professor at UC Berkeley and former Deputy Assistant Secretary of the Treasury, argued in a recent essay that the challenges confronting young job-seekers today are primarily driven by widespread policy uncertainty and a sluggish economy—not by the rapid rise of AI tools like ChatGPT or data-crunching robots. DeLong offered his analysis on July 23, roughly 10 days before the July jobs report stunned markets, revealing that the economy has been much weaker than previously thought for several months.

Prominent business leaders had also flagged troubling signs in the economy before the July jobs report dropped. IBM Vice Chair and former Trump advisor Gary Cohn went on CNBC a day before the jobs data, noting “warning signs below the surface.” Cohn said he pays close attention to the quits rate in the monthly JOLTS data, arguing that 150,000 fewer quits was an ominous sign of poor economic health.

DeLong sounded a prophetic note, writing that “policy uncertainty” over trade, immigration, inflation, and technology has “paralyzed business planning,” leading to a self-reinforcing cycle of hiring freezes. New entrants to the job market are bearing the brunt of the retreat to risk aversion. In other words, the college graduate class of 2025 is really unlucky.

The economist argued that the uncertainty causes companies to delay major decisions—including hiring—in the face of an unpredictable policy environment.

“This risk aversion is particularly damaging for those at the start of their careers, who rely on a steady flow of entry-level openings to get a foot in the door,” he wrote.

DeLong has sounded similar warnings of a slowdown for years. He talked to Fortune in 2022 about his theory of the economy starting to sputter from his book Slouching Towards Utopia. In 2025, he wrote, the big story in the jobs market is not actually AI, but something different.

Policy paralysis

So, what’s really keeping freshly minted graduates from clinching that all-important first job? DeLong cited Bloomberg BusinessWeek’s Amanda Mull and her theory about “stochastic uncertainty”—a cocktail of unpredictability around government policies, trade, immigration, and inflation. Companies aren’t firing; instead, they’re just waiting. And many are delaying new hires in anticipation of possible sudden shifts in tariffs, inflation rates, and regulatory environments. The result is a wait-and-see climate where employers, worried about future economic shocks, have selected caution over expansion. The holding pattern hits new entrants to the workforce especially hard.

While overall unemployment in the U.S. remains low, the situation is uniquely difficult for new graduates relative to the rest of the workforce. Citing economists including Paul Krugman, DeLong noted that while the absolute unemployment rate for college graduates isn’t alarming, the gap between graduate unemployment and general unemployment rates is at record highs. In the past, higher education reliably led to lower unemployment, but now recent grads are struggling “by a large margin” compared to previous generations.

As previously reported by Fortune Intelligence, Goldman Sachs has argued that the college degree “safety premium” is mostly gone. The team, led by Goldman’s chief economist Jan Hatzius, wrote: “Recent data suggests that the labor market for recent college graduates has weakened at a time when the broader labor market has appeared healthy.”

It also found that since 1997, young workers without a college degree have become much less likely to even look for work, with their participation rate dropping by seven percentage points.

Goldman Sachs

Mull cited an analysis by the Federal Reserve Bank of New York which found that tech and design fields, including computer science, computer engineering, and graphic design, are seeing unemployment rates above 7% for new graduates.

Why the AI hype misses the mark

Although the tech sector is buzzing about AI’s potential to replace junior analysts or automate entry-level tasks, DeLong urged caution in assigning blame. In his typical style, he noted, “there is still [no] hard and not even a semi-convincing soft narrative that ‘AI is to blame’ for entry-level job scarcity.” Hiring slowdowns, he pointed out, are driven by broader economic forces: uncertainty, risk aversion, and changes in how companies invest.

Here again, DeLong’s analysis rhymes and aligns with recent research from Goldman’s Hatzius. The bank’s quarterly “AI Adoption Tracker,” issued in July, found that the unemployment rate for AI-exposed occupations had reconciled with the wider economy, which contradicts fears of mass displacement. They also noted there have been no recent layoff announcements explicitly citing AI as the cause, underscoring that it’s contained to disruption of specific functions, not entire industries.

Goldman Sachs

Crucially, he argued, rather than hiring people, companies in the tech sector are splurging on “the hardware that powers artificial intelligence”—notably Nvidia’s high-performance chips—fueling a boom in capital investment while sidelining junior hires.

“For firms, the calculus is straightforward: Investing in AI infrastructure is seen as a ticket to future competitiveness, while hiring junior staff is a cost that can be postponed.”

Underpinning these trends is a shift away from any and all risk. Employers prefer to hire for specific short-term needs and are less willing to invest in developing new talent—leaving young applicants caught in a cycle where “just getting your foot in the door” is more difficult than ever. Incumbent workers, worried about job market uncertainty, are less likely to change jobs, leading to fewer openings and greater stagnation.

DeLong’s analysis harmonized with Goldman Sachs’ findings about the declining premium attached with a college degree:

“For the longer-run, the rise in the college wage premium is over, and a decline has (probably) begun.”

For decades, he continued, a college degree was a ticket to higher earnings, and the labor market rewarded those with advanced skills and credentials. In recent years, though, “this has plateaued and may even be falling.” The causes are complex, he added, but the takeaway: While degrees remain valuable, they are no longer the ever-ascending ticket to prosperity they once were.

These comments confirm the gloomy remarks of University of Connecticut professor emeritus Peter Turchin, who recently talked with Fortune about the declining status of the upper middle class in 21st century America. When asked where else he sees this manifesting in modern life, Turchin said, “It’s actually everywhere you look.

“Look at the overproduction of university degrees,” he said, arguing that the decreasing premium that Goldman and DeLong write about shows up in declining rates of college enrollment and high rates of recent graduate unemployment. “There is overproduction of university degrees and the value of a university degree actually declines.”

DeLong’s bottom line for recent grads: Blame a risk-averse business climate, not technology, for today’s job woes. And now that we know the economy may have been much more risk-averse in 2025 than previously, DeLong’s warnings are worth revisiting.

DeLong did not respond to a request for comment.

For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing. 

This story was originally featured on Fortune.com

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• President Trump erupted on social media after the Federal Reserve held interest rates steady this week. The president called on the board to “assume control” and lower interest rates on the same day a Biden-appointed Fed governor announced her resignation. Experts say Trump’s understanding of the interest rate decision is misguided and a revolt against Powell is unlikely.

Fed Governor Adriana Kugler announced Friday she is stepping down from her position earlier than expected, giving President Donald Trump the chance to expand his influence over the central bank as he calls for a revolt against Chairman Jerome Powell.

In a post on Truth Social before Kugler’s announcement, President Trump took a jab at Powell, saying he must “substantially” lower interest rates, after the Federal Open Market Committee voted overwhelmingly to keep rates unchanged.

“IF HE CONTINUES TO REFUSE, THE BOARD SHOULD ASSUME CONTROL, AND DO WHAT EVERYONE KNOWS HAS TO BE DONE,” Trump added in the post. 

Kugler said she would resign her position on Aug. 8, earlier than her expected departure in January when her term on the board of governors expires. She plans to return to Georgetown University as a professor this fall, according to a press release.

Kugler’s departure gives Trump a relished opportunity to nominate a voting member to the FOMC and expand his influence. The FOMC sets the federal funds rate that Trump has been saying needs to come down. The committee is made up of the seven governors who serve on the Fed board, the New York Fed president, and four rotating regional Federal Reserve bank presidents.

The FOMC meeting this week that kept rates unchanged between 4.25% and 4.5% saw the dissent of two Fed governors, Trump appointees Michelle Bowman and Christopher Waller. 

It marked a rare break in what’s a typically unanimous vote, but it was far from a mutiny, said Michael Ashley Schulman, the chief investment officer of Running Point Capital Advisors. 

Because interest rate decisions are decided by a simple majority vote by the FOMC’s 12 voting members, it’s possible Powell, who only gets one vote and no veto power, could be overridden. But it’s not likely, said Schulman. 

“A handful of dissents shows the committee can grumble, but a successful revolt would need at least seven ‘nays’ against Powell, an inside-the-Fed version of turning the Succession board on Logan Roy,” he told Fortune, referring to the TV show about a corporate power struggle. “Odds remain low unless the data roll over hard or new appointees tip the balance.”

Trump’s attacks on the Fed and Powell have escalated in his second term. And his constant insistence on lower rates and previous threats to appoint Powell’s successor, have put pressure on the Fed to exert its independence.

Yet, Powell still has ways he can fight back against Trump’s influence, if he chooses to, said Mark Spindel, senior adviser at F/m Investments and a co-author of The Myth of Independence: How Congress Governs the Federal Reserve. 

Powell has made clear he will serve out the remainder of his term as Fed chairman until it expires in May, yet Spindel notes Powell can also remain on the board of governors afterwards because his term on the board, which ends in 2028, is independent of his four-year term as chairman.

“Powell sticking around for a while after his chairmanship would be a scenario by which he could keep the president from attaining a majority of the board of governors, preventing all sorts of weird dynamics, and making communication by the incoming chair more difficult,” Spindel told Fortune.

Powell has repeatedly declined to say whether he intends to stay on as Fed governor after his term as chairman ends.

It’s also unclear how Trump will react if the Fed cuts rates. The economy has been largely resilient in spite of uncertainty caused in part by the threat of tariffs on major U.S. trading partners, but cracks have started to emerge. The U.S. economy added only about 73,000 jobs last month, and gains in June and May were revised down sharply, according to the Bureau of Labor Statistics. 

The new numbers were so stunning they upended the earlier narrative that the labor market was remarkably shock proof, which has colored the Fed’s stance on rates. 

In the press conference following the Fed’s decision to keep rates unchanged, Powell hesitated to guide toward a rate in the coming months. He struck a hawkish tone, according to a note by Bank of America’s macroeconomics team, putting a damper on investor hopes that the FOMC’s next meeting in September could bring a rate cut.

“It seems to me — and to almost the whole committee — that the economy is not performing as though restrictive policy is holding it back inappropriately,” Powell said.

This story was originally featured on Fortune.com

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• Despite a widespread return-to-office push, loneliness among workers remains high. KPMG survey results published Tuesday found that 81% of employees value friendships at work as “critically important,” and a majority would even prefer to earn less to work with friends than earn more without them.

While a massive return-to-office push promised to make collaboration and relationship building easier and more accessible, most workers still feel lonely at work. That’s largely due to technology use and a lack of support for employees, research shows.

Workers crave companionship so much, in fact, survey results published Tuesday from audit, tax, and advisory firm KPMG show 57% would choose a role with a salary 10% below market value to work with friends over a job with a salary 10% over market without close friendships.

This “friendship premium” effectively values workplace relationships at 20% of someone’s salary, according to KPMG.

Meanwhile, 45% of people reported feelings of loneliness in the workplace, up nearly double from KPMG’s Friends at Work report from last year. And 81% of workers consider having workplace relationships as “critically important.”

This year, KPMG surveyed 1,019 full-time employees about the relative importance of salary, friends at work, work-life balance, learning opportunities, company culture, and how technology shapes employee experiences.

KPMG’s decision to explore workplace friendships was driven by the growing recognition that human connection is essential to business success, Sandy Torchia, KPMG U.S. vice chair of talent and culture, told Fortune.

“Our [2024] survey revealed that workplace friendships are an undervalued solution for addressing issues such as loneliness, burnout and disengagement—challenges increasingly evident in today’s workforce,” she said. “Our [2025] survey indicates that these issues not only persist but are becoming even more prevalent.”

The value of friendships at work

Kelsey Szamet, a workplace attorney with Encino, Calif.-based Kingsley Szamet Employment Lawyers, told Fortune it’s no wonder some employees would choose lower pay to work with friends.

Based on her work with clients, “a warm organizational culture will often rank higher for employees compared to simple monetary pay,” Szamet said. “Working in an atmosphere of trust and friendship can lead to greater commitment and staying longer with one company even if salaries are not at the stratospheric levels for one’s expertise.”

Erin Eatough, cofounder and chief science officer at advisory firm Fractional Insights, told Fortune this trend reflects a larger redefinition of value at work.

“People are no longer just optimizing for income—they’re optimizing for meaning, growth, and connection,” said Eatough, who uses psychological science while consulting Fortune 500 leaders. She earned her Ph.D. in industrial-organizational psychology from the University of South Florida. 

“We see this in our diagnostics,” she continued. “Workers are increasingly seeking environments where they feel safe, connected, and respected. Friendship is often the most human expression of a culture that has gotten it right.”

A recent Fractional Insights survey also showed more than 50% of employees feel they have to “constantly look out for themselves at work.”

“That kind of chronic self-protection signals a breakdown of trust and belonging and it erodes motivation and innovation over time,” Eatough added. “Workplace friendships can act as a buffer against the loneliness epidemic.”

Meanwhile, workplace friendships often go beyond superficial connections. Friends can serve as support systems at important times like when an employee faces discrimination, harassment, or retaliation Szamet said. 

Generational breakdown and AI friendships

KPMG’s survey results found Gen Z values workplace friendships the most out of all groups. Two-thirds of Gen Z would choose a role with the friendship premium, followed by 58% for baby boomers, 57% of millennials, and 55% of Gen Xers.

While friendships are valuable across all generations, younger workers rely more heavily on work friends to navigate mental health and burnout, Torchia said. They’re also more likely to view their work friends as “social connectors” and “confidants,” she added. 

AI has also become a source of companionship—for better or for worse—for some workers. While 99% of workers reported they’re interested in an AI chatbot that could become a friend or trusted work companion, according to KPMG, 49% said the technology creates false connections and replaces deep conversations with superficial interactions. Torchia calls this the “great AI paradox.”

AI “can serve as a tool to help alleviate loneliness while also amplifying our hunger for authentic relationships,” she said. “The organizations winning are those leveraging emerging technology like AI to create more meaningful human interactions, not fewer.”

Eatough said the more we automate, the more precious and powerful human connections become.

“If we’re not careful, we risk designing sterile, extractive workplaces in pursuit of efficiency,” she said. But placing humans at the forefront of performance management, communication, and rewards can “create environments where both AI and authentic connection thrive side by side.”

This story was originally featured on Fortune.com

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A surprisingly weak July employment report has intensified expectations that the Federal Reserve will resume cutting interest rates as soon as September, with mounting evidence of a slowing U.S. economy and faltering labor market offsetting persistent inflation worries driven by new tariff hikes.

The Federal Open Market Committee (FOMC) had previously left rates unchanged at a range of 4.25% to 4.50% at its July meeting, despite internal disagreements, growing signs that economic conditions warranted a more dovish approach, and mounting pressure from President Donald Trump on Fed Chair Jerome Powell to cut. The July jobs report, of course, is changing the picture rapidly.

The Labor Department reported a gain of just 73,000 nonfarm payroll jobs in July, well below consensus forecasts. More troubling were the significant downward revisions for May and June, which cut a combined 258,000 jobs from the previous estimates and reduced those months’ average gains to less than 20,000 jobs per month. While July’s number alone would not spell crisis, the back-to-back weakness and hefty revisions roused investor concerns about potential cracks forming in the U.S. labor market. Powell has repeatedly emphasized the balance between labor supply and demand, and said the unemployment rate is the “key indicator to watch.” July’s unemployment rate ticked up to 4.2%, just shy of a 12-month high, providing further evidence of softening conditions.

Market reaction was swift. Stephen Brown, Deputy Chief North America Economist for research firm Capital Economics, called it a “payrolls shocker.” He noted an immediate change in markets, which repriced the likelihood of a September rate cut at 85%, a jump from below 50% prior to the jobs data, as futures traders bet that the Federal Open Market Committee will need to respond to mounting evidence of economic softening.

“The July jobs report goes a long way toward providing the evidence of a weaker labor market that the Fed needs to justify cutting interest rates in the face of above-target inflation,” said Brian Rose, senior U.S. Economist at UBS Global Wealth Management, in a statement to Fortune Intelligence. Rose noted that GDP data had shown the economy’s growth slowing to an annualized 1.2% pace in the first half of 2025, well below the longer-term trend rate of 2.0%. “We expect soft data in the second half of 2025 as well. This should help to offset some of the inflationary pressure driven by tariff hikes,” he added.

Other recent data reinforce the picture of an economy under strain. Survey indicators such as the ISM manufacturing employment index fell further in July, while measures of business capital spending have only recovered modestly after disruptions following April’s “Liberation Day.” Meanwhile, President Trump’s new tariff measures have pushed up import costs, adding to the inflation outlook.

Fiendishly mixed signals

The July payroll dip, coming on the heels of the disruptive “Liberation Day” in April, may not yet herald a deeper jobs slide, other data suggests. Brown noted that initial jobless claims ticked down to 218,000 last week, and continuing claims have declined steadily since peaking in early June.

Analysts expect Powell to use the upcoming Jackson Hole Economic Symposium, to be held August 21–23, as an opportunity to signal the central bank’s readiness to act if labor market weakness persists and larger inflation effects from tariffs do not materialize.

Rose’s baseline scenario now sees the Fed resuming rate cuts at its September meeting and continuing to cut by 25 basis points each meeting through January, trimming the federal funds rate by a full percentage point to bring borrowing costs back to a “roughly neutral” level.

“Given this morning’s data, Powell may be willing to drop a hint that the Fed is leaning toward a September cut,” Rose said.

For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing. 

This story was originally featured on Fortune.com

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The top Big Oil giants in the Western Hemisphere, Exxon Mobil and Chevron also are the top producers in the booming Permian Basin—but they’re pledging to take very different paths going forward.

While West Texas production leader Exxon aims to spike its volumes another 50% in the next five years and keep growing beyond 2030, Chevron is taking a “plateau” approach and focusing on free cash flow.

The two companies reported their earnings Aug. 1 just two weeks after they were reluctantly forced into becoming partners when a ruling from a contentious arbitration fight in Chevron’s favor allowed the company to close on its $53 billion acquisition of Hess and its crown jewel 30% stake in Exxon’s oil discovery offshore of Guyana—arguably the biggest oil discovery of the century.

However, for both companies, the Permian is their leading base of oil and gas volumes. In fact, the Permian represents almost half of the nation’s record-high 13.4 million barrels per day of crude oil. Exxon reported growing its volumes to 1.6 million barrels of oil equivalent a day, including natural gas, while Chevron hit its 2025 target of 1 million barrels daily during the second quarter.

Chevron aims to keep its Permian output relatively steady going forward.

“We’re very pleased to have such a large shale portfolio and, at some point, growth is less the objective than free cash flow, and we’re approaching that point,” said Chevron chairman and CEO Mike Wirth in an earnings call.

On the other hand, Exxon aims to hit a whopping 2.3 million barrels daily in the Permian by 2030. Exxon chairman and CEO Darren Woods said he “absolutely” disagrees with the idea of “peak” Permian oil production amid weaker prices and a maturing basin. Exxon also finds itself in an enviable position after its $60 billion acquisition last year of Permian leader Pioneer Natural Resources.

“We’re a long-ball hitter. Everybody in the unconventional [shale] space is playing the short game,” Woods said, citing scale and technology advantages that lead to much greater cost efficiencies, allowing for more value-oriented growth. “That has led us to have growing confidence the projection we have past 2030 is an upward vector and will continue to grow.”

Woods said Exxon is even open to more acquisitions going forward—just not growth for the sake of growth. Any deal must prove “one plus one equals three.”

“That is, in my mind, the magic of successful acquisitions and what we’re looking for,” Woods said.

Exxon and Chevron both delivered quarterly beats, but their earnings are down in a lower oil price environment. Exxon’s quarterly net income of $7.1 billion fell 23% year over year from $9.2 billion. Chevron’s $2.5 billion in net income dipped 43% year over year from $4.4 billion.

Hotly anticipated ruling

In Guyana, the long-awaited ruling from an arbitration panel overseen by the International Chamber of Commerce decided July 18 that Chevron’s acquisition of Hess did not violate Exxon’s right of first refusal for Hess’ Guyana stake because it bought the whole company and not just the Guyana position.

Although most industry observers expected Chevron to prevail, Woods said Aug. 1 that the ruling was a “surprise.”

“We were highly confident in our position,” Woods said. “Having co-written the contract, we understood its intent and believed the contractual language conveyed it. Unfortunately, the tribunal interpreted it differently. While disappointed, we respect the process and the ruling.”

Woods said the shared Guyana production volumes should grow to at least 1.3 million barrels of oil equivalent daily by 2030.

For Chevron, the Hess and Guyana acquisition helps offset “disappointing” global oil and gas exploration results in recent years. The company had leaned in on onshore U.S. volumes, cost reductions, and long-cycle international developments that were in development, Wirth said.

Exploration will grow going forward, he said. “But overall, our MO (modus operandi) or our reputation for capital discipline will remain.”

This story was originally featured on Fortune.com

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President Donald Trump on Friday ordered the firing of Dr. Erika McEntarfer, the Commissioner of the Bureau of Labor Statistics (BLS), igniting a political and economic firestorm as the administration grappled with unexpectedly weak jobs numbers that included a large downward revision of the last two months of jobs data. “I have directed my Team to fire this Biden Political Appointee, IMMEDIATELY,” Trump said on social media Friday.

The decision followed the release of July’s employment report, which showed that only 73,000 nonfarm payroll jobs were added to the U.S. economy—far below economist forecasts. The report also included sharp downward revisions to the previous two months, with 258,000 jobs stripped from earlier estimates and unemployment ticking up to 4.2%.

On social media, Trump also claimed without evidence that McEntarfer “faked the Jobs Numbers before the Election to try and boost Kamala’s chances of Victory,” referencing to his defeated opponent in the 2024 election, Vice President Kamala Harris. Trump declared: “Important numbers like this must be fair and accurate, they can’t be manipulated for political purposes.”

Appointed in January 2024, McEntarfer had previously served in senior roles within federal statistical agencies. The move marks a rare and dramatic intervention in federal economic reporting. Since its founding in 1884, the BLS has operated independently from political pressure, with its data releases pre-scheduled to reduce the risk of manipulation. The BLS commissioner typically serves a four-year term, confirmed by the Senate, with past presidents largely respecting the office’s autonomy regardless of economic headwinds.

Remarking on the jobs report, including the large downward revisions which he called a “major mistake,” Trump added: “Similar things happened in the first part of the year, always to the negative.”

Markets responded swiftly to the jobs report and the abrupt leadership shakeup. Stocks fell sharply on Friday as investors digested the weak employment numbers alongside the uncertainty created by turmoil within the government’s statistical agencies. U.S. bond yields dropped as traders increased bets on imminent Federal Reserve interest rate cuts, which Trump and some Republican allies have also accused the Fed of timing to help Democrats—allegations the central bank strongly denies.

McEntarfer, who has yet to issue a public statement, was widely regarded as a data-focused technocrat. White House officials have not yet named a replacement.

For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing. 

This story was originally featured on Fortune.com

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• President Donald Trump’s announcement of a new sweeping round of tariffs has renewed investor concerns about an economic downturn. Investor Danny Moses, made famous by the book-turned-movie The Big Short, told Fortune that despite continued noise, the market is going through a stagflationary period.

Following the latest round of tariffs, it’s only a matter of time before the other economic shoe drops, according to one investor who predicted the 2008 stock market crash.

Danny Moses, the founder of Moses Ventures who was made famous by the book-turned-movie The Big Short, warned that despite some strong economic indicators in the face of tariff uncertainty, signs of stagflation are already upon us.

“There’s just so many moving parts right now that it’s really hard to decipher where you’re going to pinpoint,” Moses told Fortune. “Anyone can find a data point that says it’s inflationary, and someone can find a data point that says it’s not. So it’s just difficult. But bottom line … Is the [economy] going through a stagflationary period? It appears to me, it is.”

President Donald Trump announced on Friday a new round of sweeping tariffs, including a 39% tax on Swiss exports and a 35% tax on some Canadian exports to the U.S. The administration is extending the trade-deal deadline to other countries including Mexico, America’s largest trade partner, which is getting an extra 90 days. The logic behind the tariffs differs slightly from previous rounds, where Trump has argued for levies as a means to eliminate trade deficits. The U.S., for example, has had a trade surplus with Brazil for about a decade. Instead, Trump has imposed steep tariffs on Brazil for political reasons, such as the prosecution of ally and former Brazilian President Jair Bolsonaro, who was accused of plotting a coup following his loss of the presidential election.

Markets dipped after the announcement—as well as a weaker-than-expected jobs report— following a weeklong rally of strong earnings and fading trade-war fears. But Moses said the latest round of tariffs have once again stirred anxiety over the economy’s future, making investors “a little bit more concerned about the unpredictability of what’s coming out.”

“Nobody knows how this is going to pan out, because this type of thoughtless tariff is unprecedented,” Moses said.

Where’s the stagflation?

Fears of stagflation, or the stagnation of economic growth coinciding with inflation, have been easing, particularly following the Wednesday GDP data showing a rebound in U.S. economic growth in the second quarter of the year. This followed a negative first-quarter GDP estimate that was largely a result of the timing of trade chaos forcing companies to stockpile goods before pricing in consumers purchasing that inventory. Ultimately, the second-quarter growth undid the first quarter’s contraction, though economic growth slowed in the first half of the year.

White House spokesperson Kush Desai told Fortune in a statement that recovering growth and “cooling inflation … suggest stagflation is simply the latest buzzword for panican [sic] paranoia.”

Moses said the economy has not yet seen the full impact of the tariffs. Fed Chair Jerome Powell held interest rates steady this week and said more information is needed to deliver a rate cut.

“Higher tariffs have begun to show through more clearly to prices of some goods, but their overall effects on economic activity and inflation remain to be seen,” Powell told reporters following the Fed meeting on Wednesday. “A reasonable base case is that the effects on inflation could be short-lived—reflecting a one-time shift in the price level. But it is also possible that the inflationary effects could instead be more persistent, and that is a risk to be assessed and managed.”

Not only will inflation likely increase as it has already begun to do, albeit modestly, Moses said, but companies will continue to confront the impact of tariffs. Apple was the latest giant to feel the burn from tariffs, reporting on Friday strong earnings, but a $1.1 billion hit from the levies. As companies continue to reckon with the impact of tariffs, they will likely choose to both eat margins and compromise growth, as well as raise prices on goods, according to Moses, with stagflation being the most probable outcome.

“Pick your poison,” Moses said. “It’s either going to hit corporate margins, and earnings will go down, which means the market’s expensive, or it’ll be passed on to the consumers and be inflationary. I think it’s going to be a combination of both.”

This story was originally featured on Fortune.com

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Monday’s mass shooting in Midtown Manhattan claimed the life of Wesley LePatner, a 43-year-old executive at Blackstone, the company confirmed Tuesday morning. LePatner was among four victims killed at 345 Park Avenue when a lone gunman stormed the office building, which also serves as the headquarters of the National Football League and features other business clients such as KPMG. The shooter has been identified by police as 27-year-old Shane Tamura of Las Vegas.

LePatner served as Blackstone’s global head of core+ real estate and chief executive officer of Blackstone Real Estate Income Trust (BREIT), a property fund with a $53 billion net asset value and a $275 billion market capitalization. 

The LePatner family provided a statement to Fortune, saying, “We cannot properly express the grief we feel upon the sudden and tragic loss of Wesley. She was the most loving wife, mother, daughter, sister and relative, who enriched our lives in every way imaginable.” The family noted that she was a beloved, loyal, and caring friend to many others and a “driven and extraordinarily talented professional and colleague.”

The family offered its condolences to those who have also lost loved ones, and asked for privacy in the coming days and weeks. “At this unbearably painful time, we are experiencing an enormous, gaping hole in our hearts that will never be filled, yet we will carry on the remarkable legacy Wesley created.”

A decorated background

LePatner joined Blackstone in 2014 after more than a decade with Goldman Sachs and was credited with driving the firm’s real estate ventures to new heights. A Yale graduate, LePatner served on the boards of organizations including the Metropolitan Museum of Art, the Abraham Joshua Heschel School, the UJA-Federation of New York, and Yale University Library Council, according to her Blackstone biography page. She is survived by a husband whom she met on the first day of freshman year at Yale, according to their New York Times wedding announcement. She had two children, the New York Post was first to report.

New York Rep. Ritchie Torres posted on social media that LePatner “represented the very best of New York.” Calling her a “distinguished professional,” he honored her sense of civics, as a “devoted congregant” at the Altneu synagogue and a dedicated board member at the Heschel School.

Authorities say Tamura acted alone and had a history of mental-health issues. Investigators recovered a note where Tamura raged against the NFL, claiming to suffer from chronic traumatic encephalopathy (CTE)—a neurodegenerative disease associated with head injuries in contact sports. While Tamura played football in high school, there is no evidence he played professionally or was ever diagnosed with CTE.

“Words cannot express the devastation we feel. Wesley was a beloved member of the Blackstone family and will be sorely missed,” Blackstone said in an emailed statement. “She was brilliant, passionate, warm, generous and deeply respected within our firm and beyond.”

For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing. 

This story was originally featured on Fortune.com

© The Wesley LePatner family

• Dylan Field cofounded Figma in 2012 with a Brown University teaching assistant. Since then, Field has led the company to meteoric success and a historic IPO. 

Fifteen years ago, Dylan Field was a freshman computer science student at Brown University. On Thursday, the company he started in college and now runs, Figma, made its blockbuster debut on the New York Stock Exchange, marking the largest U.S. venture-capital-backed tech IPO in four years. 

Figma’s stock surged 250% on its debut, making it the largest first-day pop for a billion-dollar tech IPO and cementing its status as a bellwether for a resurgent tech IPO market. Demand was so intense that many hopeful investors received only a handful of shares, while trading was temporarily halted due to volatility.

Closing at $115.50, the IPO instantly catapulted Figma’s valuation to nearly $68 billion—more than triple Adobe’s failed $20 billion acquisition offer for the company just two years ago. 

The multibillion-dollar company, however, began with an idea thought up by Field and cofounder Evan Wallace, who was a Brown teaching assistant at the time. The duo explored the potential of new browser technologies and began brainstorming ways to democratize creative design through software. But it wasn’t until 2012, when Field was awarded the prestigious Thiel Fellowship, a $100,000 grant for young entrepreneurs willing to leave college that he and Wallace dove headfirst into what became Figma, the popular web-based design tool used for user interface and user experience design.

Field, now 33, was always a high achiever, especially with technology. At age three, he taught himself to use his family computer, and his interest in robotics began early in childhood. In the early 1990s, Field also worked as a child actor, starring in several commercials, including one for Windows XP. But ultimately his academic successes landed him at the Rhode Island Ivy League school and several competitive tech internships.

The Penngrove, Calif., native held several part-time gigs while studying at Brown, including a nine-month stint as a research assistant at Microsoft, a four-month data analytics internship at LinkedIn, and two internships at aggregation software company Flipboard—first as a software engineering intern and then a product design intern. His second Flipboard stint was part of the Kleiner Perkins Fellows Program, a highly competitive program that places selected students with companies in the Kleiner Perkins portfolio.

It was through his LinkedIn and Flipboard jobs that Field secured seed investments for his entrepreneurial ventures and eventually propelled himself to billionaire status by 33 years-old. Both his LinkedIn manager Peter Skomoroch and Danny Rimer, a general partner at Index Ventures who recognized Field’s potential during a Flipboard board presentation, helped the young founder finance his start. 

“Here was this 19-year-old, who had a lot of clarity about what he wanted to do—democratize the world of design, and provide tools to everyone,” Rimer told Fortune in 2023. “He had this ambition of dropping out of university to go after this crazy idea, where it’s clear that he’s not going to be able to come up with a product for over two years. In the world of move-fast-break-things, here were two folks [Field and Wallace] who were saying, ‘We’re not going to have anything for two years, so we hope you’re comfortable with that.’”

Other early Figma investors included Phoenix Court and Greylock Partners.

Index Ventures ultimately led Figma’s 2013 seed round with a $1.7 million investment. And in the following 12 years, the fund reportedly invested $86.5 million in the company.

Much like Rimer predicted, it took Field and Wallace until September 2016 to launch the product publicly, after years of meticulous planning to create the so-called Google Docs for graphic designers. By 2018, the company was valued at $115 million, a figure that skyrocketed during the pandemic. In June 2021, Figma’s valuation was $10 billion. That same year, Wallace left the company. 

In September 2022, Adobe announced plans to acquire Figma for $20 billion, a deal which would have made Field—then just 30 years old—a billionaire several times over. But regulatory roadblocks killed the deal in 2023, and as part of the cancellation, Adobe paid Figma a $1 billion breakup fee.

Figma and Field soldiered on, despite the failed acquisition. The company’s 2024 revenue reached $749 million, up 48% from 2023. And in the first quarter of 2025, revenue grew 46% year over year. Figma, as of early 2025, has 13 million monthly active users, and 95% of Fortune 500 companies use the software.

Now, as Figma closes its first, astonishing chapter as a public company, Field shows no sign of slowing down. “We know this is just the start,” Field wrote in a statement after ringing the opening bell. “This is a vision that will play out over many decades and I believe Figma’s most innovative days are ahead.”

Figma declined a Fortune request for comment.

This story was originally featured on Fortune.com

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When Coinbase published its second-quarter earnings on Thursday, the results were ho-hum at best: a narrow miss on revenue and a decline in trading volume, which led the company’s stock—which has been on a tear in recent months—to drop by around 15%. The market’s focus on typical earnings metrics, though, mean the news coverage largely overlooked three very significant one-off numbers that matter a lot to Coinbase’s short- and long-term future.

The first of those numbers is $1.5 billion. That figure reflects what Coinbase described as “pretax gains on strategic investments—which included an unrealized gain on our investment in Circle.” Translation: Coinbase hit the jackpot when Circle, its partner on the fast-growing USDC stablecoin, went public in early June and saw the value of its shares soar soon after.

Coinbase is presumably subject to the same six-month lockup as other Circle shareholders, and it’s unclear when the company might cash out its windfall or if those shares will still be worth as much when it decides to do so. But even if Circle stock does decline, it’s a safe bet that Coinbase will still be sitting on a large and liquid investment it can cash out during a downturn, or use to fuel its impressive acquisition spree.

It’s also important to recognize that Circle is just one of many crypto firms in which Coinbase has an equity stake. As the crypto market continues to mature, other startups will go public, and it’s a good bet that Coinbase will be in a position to collect when they do. If this proves to be the case, the $1.5 billion that the company reported as a one-time item will actually be replicated to greater or lesser degrees in upcoming quarters.

The second one-time number Coinbase reported on Thursday is part of a far less positive story. That would be the “$307 million in expenses related to the data theft incident disclosed in May.”

The “incident” in question is the calamitous hacking episode that saw criminals bribe customer service agents in India, and then use the personal data they garnered to pose as Coinbase employees and defraud customers. In response, Coinbase pledged to make good any customer who lost money in the scheme and to put a $20 million bounty on the heads of those responsible.

If the fallout from the episode only costs $307 million, Coinbase can count that as a win. But that’s a big if in light of the gaggle of class action lawyers and state regulators lining up to extract a payout from the company over the data breach. Then there is the reputational damage that goes with Coinbase failing to see how outsourcing sensitive customer data to dirt-cheap agents in India posed a security risk. For now, though, the company appears to have weathered the PR storm, and its announcement of a new customer service “Center of Excellence” in North Carolina could help to smooth out remaining mistrust.

Finally, there is a third big one-off number tucked into Thursday’s earnings report: “a $362 million pretax gain on our crypto investment portfolio (largely unrealized).” This reflects a pair of significant recent developments. The first is the obvious run-up in crypto asset prices, which is fattening Coinbase’s treasury holdings. The other is the recent change in accounting rules that allows companies to record crypto gains as they accrue. While companies accumulating crypto on their balance sheet is generally a dicey corporate finance strategy, it is fortunately only a small part of Coinbase’s operations, and for now, the gains are very real and help to strengthen its already strong fundamentals.

While one-off numbers are typically just that—temporary noise that shouldn’t be mistaken for a signal of a company’s broader performance—they can also represent something more. That is the case with Coinbase’s Q2 earnings, where items like its massive Circle windfall arguably matter more than the usual quarter-to-quarter revenue and trading fluctuations.

This story was originally featured on Fortune.com

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• Some Silicon Valley startups are embracing China’s outlawed “996” work culture, expecting employees to work 12-hour days, six days a week, in pursuit of hyper-productivity and global AI dominance. The trend has sparked debate across the U.S. and Europe, with some tech leaders endorsing the pace while others warn it risks mass burnout and startup failure.

Silicon Valley’s startup hustle culture is starting to look more and more like an outlawed Chinese working schedule.

According to a new report from Wired, Bay Area startups are increasingly leaning into models resembling China’s 996 working culture, where employees are expected to work from 9:00 a.m. to 9:00 p.m., six days a week, totaling 72 hours per week. 

Startups, especially in the AI space, are openly asking new starts to accept the longer working hours. For example, AI start-up Rilla tells prospective employees in current job listings not to even bother applying unless they are excited about “working ~70 hrs/week in person with some of the most ambitious people in NYC.”

The company’s head of growth, Will Gao, told Wired there was a growing Gen-Z subculture “who grew up listening to stories of Steve Jobs and Bill Gates, entrepreneurs who dedicated their lives to building life-changing companies.” He said nearly all of Rilla’s 80-person workforce works on a 996 schedule.

The rise of the controversial work culture appears to have been born out of the current efficiency squeeze in Silicon Valley. Rounds of mass layoffs and the rise of AI have put pressure and turned up the heat on tech employees who managed to keep their jobs.

For example, in February, Google co-founder Sergey Brin told employees who work on Gemini that he recommended being in the office at least every weekday and said 60 hours is the “sweet spot” for productivity.

Other tech CEOs, including Elon Musk and Mark Zuckerberg, have stressed that productivity among workers is king, even if that means working hours or days of overtime. In November 2022, Musk infamously told remaining X, then Twitter, employees to commit to a new and “extremely hardcore” culture or leave the company with severance pay. 

Part of the reasoning for the intense work schedules is a desire to compete with China amid a global AI race. Especially after Chinese startup DeepSeek released an AI model on par with some of the top U.S. offerings, rocking leading AI labs.

China has outlawed 996

China has actually been trying to clamp down on the 996 culture at home. In 2021, China’s top court, the Supreme People’s Court, and the Ministry of Human Resources and Social Security jointly declared China’s “996” working culture was illegal. At the time, the move was part of the Chinese Communist Party’s broader campaign to reduce inequality in Chinese society and limit the power of the nation’s largest tech companies.

But the practice has already spilled over to other countries. Earlier this summer, the European tech sector also found itself in a heated debate over the working culture.

Partly exacerbated by an ongoing debate about Europe’s competitiveness in the technology and AI space, some European VCs warned that more work and longer hours may be needed to effectively compete.

Harry Stebbings, founder of the 20VC fund, said on LinkedIn in June that Silicon Valley had “turned up the intensity,” and European founders needed to take notice.

“[Seven] days a week is the required velocity to win right now. There is no room for slip up,” Stebbings said in the post. “You aren’t competing against random company in Germany etc but the best in the world.”

Some other founders weighed in, criticizing the rise of the 996 working culture and warning that it could quickly lead to burnout culture. Among them was Ivee Miller, a general partner at Balderton Capital.

“Burnout [is] one of the top 3 reasons early-stage ventures fail. It is literally a bad reason to invest,” Miller said on LinkedIn. 

This story was originally featured on Fortune.com

A sweeping July 2025 report from UBS Evidence Lab highlights that artificial intelligence, and generative AI in particular, is rapidly becoming a strategic imperative for consumer-sector companies around the globe, but its not really “visible” yet.

“It’s becoming an essential strategic focus and a competitive differentiator across the entire value chain, not just a tool for efficiency,” the authors write. They see wide-reaching use cases, from demand forecasting to supply-chain automation to product recommendations, and believe it should provide a “more pleasant customer experience” on top of improving operations. The use of AI will be a critical factor going forward that separates winners and losers in the consumer space, they add. It’s just so early.

Despite prominent case studies and a surge in executive attention, UBS finds the direct, quantifiable financial impact of AI remains limited, stating simply about profits and loss statements, or P&L: “AI’s impact on P&L is not material, but we expect it to be visible in the next 3 years.” Meanwhile, despite many headlines about AI-related layoffs, UBS finds little evidence of reductions in headcount: “We have heard some anecdotal evidence but not within our coverage.” Such reductions in force are likely to come, though, UBS added.

Drawing on in-depth interviews with analysts and company disclosures across more than 20 global sectors, the report details how AI is reshaping everything from supply chains and marketing to customer experience, while underscoring the most significant changes—and competitive divides—are yet to fully appear. “Most consumer companies expect the impact of generative AI to be more visible in 3 to 5 years,” the note adds.

AI moves from back office to boardroom

A central theme: AI has moved beyond being a back-office efficiency tool to a core part of business strategy. Large retail and consumer-oriented firms, notably Walmart, are appointing executives dedicated to AI transformation, underscoring its rising importance. The number of AI mentions on consumer-sector conference calls has doubled since 2022, and major investments are being made not only to streamline operations, but also to power growth through personalized recommendations, smarter inventory management, and targeted marketing.

Leading companies are finding a wide range of AI applications, the UBS Evidence Lab found.

• Walmart uses AI-driven recommendations and assistants to personalize the shopping experience and optimize fulfillment. Automation in its supply chain is credited with up to 30% reductions in unit costs at fulfillment centers.
• L’Oréal leans on AI for marketing optimization and product innovation, reporting 10%-15% productivity gains in advertising tasks due to its bespoke BETiq tool, which it expects to cover 60% of its marketing spend by 2024.
• P&G utilizes AI for logistics, and it has quantified a potential $200 million-$300 million in savings from smarter truck scheduling.

Globally, consumer-facing companies are also deploying AI for tasks ranging from product design (e.g., Robam’s proprietary LLM called “AI Gourmet” in China), to dynamic pricing, to smarter labor scheduling. In Australia, travel firms and retailers have cited cost savings and improved margins from AI-enabled automation.

Bigness will matter

A recurring takeaway is that large, well-capitalized incumbents are set to benefit most in the near to medium term. These players, such as Walmart, Home Depot, Coca-Cola, L’Oréal, and China’s Midea and Haier, can better afford the investments and have the customer data troves needed to maximize AI’s benefits. In contrast, smaller and less technologically advanced companies may struggle to compete, potentially accelerating industry consolidation or leaving followers at a disadvantage.

While patterns of AI adoption are broadly similar worldwide, impacts vary by region and sector. U.S. retailers and restaurant chains have focused on operational efficiency and customer engagement. The European luxury sector, more dependent on craftsmanship and brand, should see less near-term impact from AI. In Asian markets, market leaders are leveraging AI to drive product differentiation and cost advantages, but there is little evidence of broad profit impact yet.

Only a handful of companies, usually industry giants with deep pockets and rich data sets, are reporting clear improvements in margins or revenue directly attributable to AI adoption. Most firms, especially smaller ones, have yet to see material P&L enhancements. In many cases, AI’s efficiency gains are being reinvested to spur growth, rather than dropping to the bottom line.

Outlook: gains to materialize over 3–5 years

Most analysts expect the true financial benefits—higher margins, revenue growth, and labor productivity—to become “visible” within three to five years, as AI applications mature and become more deeply integrated into core business processes. In the meantime, a wave of experimentation—particularly in marketing, logistics, and customer experience—is laying the foundation for a potentially transformative decade for consumer industries.

For now, UBS concludes that for all the excitement, the AI revolution’s effects on consumer-sector profits and workforce structure are only just beginning to be felt.

For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing. 

This story was originally featured on Fortune.com

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• As unemployment climbs and AI wipes out white-collar jobs, Walmart is dangling six-figure salaries and luxury perks to lure tech workers. The Fortune 500 retail giant is actively hiring software engineers, data scientists, and product managers. A senior director in data science can expect to earn up to $320,000.

Landing a lucrative tech job has never been easy—but this year in particular has presented unique challenges thanks to AI’s revolution of the job market and a worsening labor market.

Some companies are using AI to boost productivity. Others are using it as a reason to slash headcount. Firms like Intel, Google, and Microsoft have cut jobs in recent months, but while their leaders haven’t solely blamed the technology, others haven’t minced words.

“We will need fewer people doing some of the jobs that are being done today, and more people doing other types of jobs,” Amazon CEO Andy Jassy wrote in a recent internal memo. “In the next few years, we expect that this will reduce our total corporate workforce as we get efficiency gains from using AI extensively across the company.”

But there are still opportunities for workers to find success in today’s job market. Walmart, the No. 1 company on the Fortune 500 list, is on the hunt for experienced software engineers, data scientists, IT product managers, and more—with dozens of open job postings making six-figures, with some roles extending to over $300,000.

The perks and paychecks on offer at Walmart 

Pickleball classes, hydromassages, and rooftop lounges.

Those are the perks you could be enjoying if you’re willing to pack your bags and move to Bentonville, Arkansas, and take a job at Walmart’s new 350-acre luxury campus.

And while the office alone might not convince you to relocate to small-town America, the retail giant is still willing to shell out high-paying salaries for competitive tech talent. Walmart is on the hunt for experienced software engineers, data scientists, IT product managers, and more.

Here’s what each can expect to earn: 

• Software engineer
  • Staff, software engineer: $132,000-$264,000
  • Principal, software engineer: $110,000-$220,000
  • Senior, software engineer: $90,000-$180,000
  • Distinguished, software engineer: $156,000-$338,000

• IT product managers
  • Staff, product manager: $110,000-$220,000
  • Senior, product manager: $90,000-$180,000
  • Principal, product manager: $110,000-$220,000

• Data scientists
  • Staff, data scientist: $143,000-$286,000
  • Senior, data scientist: $90,000-$180,000
  • Distinguished, data scientist: $130,000-$312,000
  • Principal, data scientist: $143,000-$286,000

• UX designers
  • Senior UX designer: $90,000-$180,000
  • Senior manager, UX design: $110,000-$220,000
  • Senior, design researcher: $90,000-$180,000

• Tech directors
  • Director, software engineering: $130,000-$260,000
  • Group director, software engineering: $195,000-$370,000
  • Director, data science: $169,000-$338,000
  • Senior director, data science: $160,000-$320,000

These numbers were sourced based on Fortune analysis of active job postings, but the exact compensation package, including salary, bonus opportunities, and stock award, will likely vary by role and depend heavily on a candidate’s experience. Location, too, is a factor, with Walmart also recruiting for its satellite locations like in California and Washington.

Fortune reached out to Walmart for comment.

The secrets to landing a job in today’s rocky market

Despite this revolution, some best practices still hold true for landing a high-paying gig. But because careers are changing faster than ever, Jassy encourages Gen Z to stop worrying about what their job will look like in 10 years—and focus on finding a passion.

“I have a 21-year-old son and a 24-year-old daughter, and one of the things I see with them and their peers is they all feel like they have to know what they want to do for their life at that age,” Jassy said on the podcast, How Leaders Lead with David Novak. “And I really don’t believe that’s true.”

And it’s a practice he learned from personally; Jassy experimented in sportscasting, soccer coaching, and investment banking before landing at Amazon.

“I tried a lot of things, and I think that early on, it’s just as important to learn what you don’t want to do as what you want to do, because it actually helps you figure out what you want to do.”

For Walmart CEO Doug McMillion, one of the secrets for success is simple: raising your hand and being a team player.
“Nothing happens through the work of just an individual,” McMillon told Stanford’s Graduate School of Business this May. “We all do this together.”

This story was originally featured on Fortune.com

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A new Federal Reserve Board staff paper concludes that generative artificial intelligence (gen AI) holds significant promise for boosting U.S. productivity, but cautions that its widespread economic impact will depend on how quickly and thoroughly firms integrate the technology.

Titled “Generative AI at the Crossroads: Light Bulb, Dynamo, or Microscope?” the paper, authored by Martin Neil Baily, David M. Byrne, Aidan T. Kane, and Paul E. Soto, explores whether gen AI represents a fleeting innovation or a groundbreaking force akin to past general-purpose technologies (GPTs) such as electricity and the internet.

The Fed economists ultimately conclude their “modal forecast is for a noteworthy contribution of gen AI to the level of labor productivity,” but caution they see a wide range of plausible outcomes, both in terms of its total contribution to making workers more productive and how quickly that could happen. To return to the light-bulb metaphor, they write that “some inventions, such as the light bulb, temporarily raise productivity growth as adoption spreads, but the effect fades when the market is saturated; that is, the level of output per hour is permanently higher, but the growth rate is not.”

Here’s why they regard it as an open question whether gen AI may end up being a fancy tech version of the light bulb.

Gen AI: A tool and a catalyst

According to the authors, gen AI combines traits of GPTs—those that trigger cascades of innovation across sectors and continue improving over time—with features of “inventions of methods of invention” (IMIs), which make research and development more efficient. The authors do see potential for gen AI to be a GPT like the electric dynamo, which continually sparked new business models and efficiencies, or an IMI like the compound microscope, which revolutionized scientific discovery.

The Fed economists did caution that it is early in the technology’s development, writing: “The case that generative AI is a general-purpose technology is compelling, supported by the impressive record of knock-on innovation and ongoing core innovation.”

Since OpenAI launched ChatGPT in late 2022, the authors said gen AI has demonstrated remarkable capabilities, from matching human performance on complex tasks to transforming frontline work in writing, coding, and customer service. That said, the authors noted they are finding scant evidence that many companies are actually using the technology.

Limited but growing adoption

Despite such promise, the paper stresses that most gains are so far concentrated in large corporations and digital-native industries. Surveys indicate high gen AI adoption among big firms and technology-centric sectors, while its use in small businesses and other functions lag behind. Data from job postings show only modest growth in demand for AI skills since 2017.

“The main hurdle is diffusion,” the authors write, referring to the process by which a new technology is integrated into widespread use. They note that typical productivity booms from GPTs like computers and electricity took decades to unfold as businesses restructured, invested, and developed complementary innovations.

“The share of jobs requiring AI skills is low and has moved up only modestly, suggesting that firms are taking a cautious approach,” they write. “The ultimate test of whether gen AI is a GPT will be the profitability of gen AI use at scale in a business environment, and such stories are hard to come by at present.” They know that many individuals are using the technology, “perhaps unbeknownst to their employers,” and they speculate that future use of the technology may become so routine and “unremarkable” that companies and workers no longer know how much it’s being used.

Knock-on and complementary technologies

The report details how gen AI is already driving a wave of product and process innovation. In health care, AI-powered tools draft medical notes and assist with radiology. Finance firms use gen AI for compliance, underwriting, and portfolio management. The energy sector uses it to optimize grid operations, and information technology is seeing multiple uses, with programmers using GitHub Copilot to complete tasks 56% faster. Call center operators using conversational AI saw a 14% productivity boost as well.

Meanwhile, ongoing advances in hardware, notably rapid improvements in the chips known as graphics processing units, or GPUs, suggest gen AI’s underlying engine is still accelerating. Patent filings related to AI technologies have surged since 2018, coinciding with the rise of transformer architecture—a backbone of today’s large language models.

‘Green shoots’ in research and development

The paper also finds gen AI increasingly acting as an IMI, enhancing observation, analysis, communication, and organization in scientific research. Scientists now use gen AI to analyze data, draft research papers, and even automate parts of the discovery process, though questions remain about the quality and originality of AI-generated output.

The authors highlight growing references to AI in R&D initiatives, both in patent data and corporate earnings calls, as further evidence that gen AI is gaining a foothold in the innovation ecosystem.

Cautious optimism—and open questions

While the prospects for a gen-AI-driven productivity surge are promising, the authors warn against expecting overnight transformation. The process will require significant complementary investments, organizational change, and reliable access to computational and electric power infrastructure. They also emphasize the risks of investing blindly in speculative trends—a lesson from past tech booms.

“Gen AI’s contribution to productivity growth will depend on the speed with which that level is attained, and historically, the process for integrating revolutionary technologies into the economy is a protracted one,” the report concludes. Despite these uncertainties, the authors believe gen AI’s dual role—as a transformative platform and as a method for accelerating invention—bodes well for long-term economic growth if barriers to widespread adoption can be overcome.

Still, what if it’s just another light bulb?

For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing. 

This story was originally featured on Fortune.com

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Even as crypto finds growing traction on Wall Street and among retail investors, few people regard the blockchain technology that powers it as useful or relevant to their day-to-day lives. A crypto startup called Subzero Labs wants to change this, and it plans to launch its own blockchain designed for use beyond just speculation.

“We’re doing something for the real-world users,” Ade Adepoju, cofounder and CEO of Subzero Labs, told Fortune.

The startup announced Friday that it had raised $20 million in a seed round led by the crypto investment firm Pantera Capital. Other participants included the crypto venture capital company Variant, the venture arm of Coinbase, and the crypto desk of the high-frequency trading firm Susquehanna.

Adepoju declined to detail his startup’s valuation. The deal, which closed in the first quarter of the year, was for equity and token warrants, or allocations of a yet-to-be-released cryptocurrency, he said. 

iPod to iPhone

Adepoju, who is 30 years old and lives in New York City, is a longtime engineer. Early in his career, he worked at the chipmaker AMD, moved over to the laptop giant Dell, and then got a job at the streaming titan Netflix. In 2021, he decided to take the plunge into crypto when he joined the startup Mysten Labs as an engineer.

Founded by former Meta developers, Mysten Labs is one of the main companies behind the Sui blockchain, whose tech stems from Mark Zuckerberg’s failed attempt to launch his own stablecoin. Adepoju helped build Sui from conception to launch, but, in early 2024, he took a career break. “I wanted to take a step back and observe what it meant to make a network actually successful,” he said.

As he pondered his next move, he linked up with his cofounder Lu Zhang, also a former employee of Mysten Labs, and decided to get into the business of launching his own blockchain. Together, the two created Subzero Labs, which currently has 20 employees.

Some might argue that, at a time when there are dozens of active blockchain projects, the world is not exactly clamoring for another one. In response, Adepoju argues that none are good enough yet to run real-world applications. “When you actually ask, ‘do we need another one?’ it’s like asking, ‘do we need another iPod?’” he said. “No, we don’t, but we definitely need an iPhone.”

He’s hoping his new blockchain, dubbed Rialo, will be that iPhone. An acronym, Rialo stands for “Rialo isn’t a layer 1.” Layer-1 blockchains are like Ethereum, which is a decentralized network of servers that processes and stores data. Layer 2s are blockchains built on top of layer-1 blockchains.

Adepoju says Rialo isn’t a layer 1, 2, 3, 4, 5, or 6. In fact, he’s reluctant to compare it to any existing crypto products. He does say the blockchain is designed for non-crypto developers and that it allows engineers to replicate tools usually implemented outside a blockchain. These include the ability to access information, like a FICO score, elsewhere on the internet without the need of an oracle, or outside data provider.

“Cameras used to ship with laptops. They used to be separate,” he said, referring to external video cameras people used to connect to their computers in the early 2000s. “They got bundled. These things happen with every technology.”

This story was originally featured on Fortune.com

© Courtesy of Subzero Labs

• Workers making over $100,000 no longer consider themselves “rolling in it”—more than half of six-figure earners no longer feel financially successful. Those with top salaries are shopping at discount grocery stores, and cutting back on dining, clothes, and travel as they try and make ends meet. They’re even stalling major life plans—like renovating their homes, and throwing their weddings. 

Being a six-figure earner once felt like an exclusive club, with the promise of a lavish life—but now those making over $100,000 are feeling the pinch. So much so that they’re even buying their groceries at dollar stores and ditching takeouts.

More than half (58%) of six-figure earners no longer feel financially successful, according to a recent report from Clarify Capital. 

Six-figure earners aren’t choosing to fly economy over first-class—they’re looking for better deals when it comes to the essentials. More than seven in 10 of these high earners are now being forced to shop at discount grocery chains to save cash. 

Around 74% also say they’re cutting back on dining out, 54% are skimping out on entertainment, 51% are getting thrifty with buying clothes, 49% are scaling back their subscriptions, and 49% are spending less on travel. 

However, they’re not ashamed of their new thrifty ways, with 62% of six-figure earners proudly claiming they aren’t embarrassed to admit they’re cutting back. 

“In today’s economy, income alone doesn’t guarantee financial peace of mind,” the report says. “High earners are feeling squeezed by inflation, stressed by social pressure, and more mindful about what it really means to be well-off.” 

“As spending habits shift and priorities change, one thing is clear: real wealth is about security, not just status.”

The wealthy are cutting back on major life purchases too

Once the epitome of “making it” in America, workers earning six figures are now in the same boat as their less wealthy peers. 

And beyond the day-to-day expenses, those considered to be “rich” are also delaying major life purchases. About 47% are setting back their dream vacations and travel, 31% are stalling on home renovations, and 26% are delaying buying or leasing a new car.

Perhaps unsurprisingly, the tough housing market has forced many to rethink their American dream timelines, as 17% are pushing back buying a new home—and 6% of six-figure earners are even delaying getting married. 

Essentially, the rising cost of living crisis has forced people in all tax brackets to watch their spending, causing anxiety. About 85% of six-figure workers say they feel stressed and anxious due to increased living costs—and it’s even worse for women. Around 88% of top-earning women feel worried about keeping their checkbooks balanced, compared to 81% of men. 

The new upper-class: making more than $200,000

It’s no surprise that six-figure earners are pinching pennies when it comes to daily essentials—after all, more than half of Americans making over $100,000 annually lived paycheck to paycheck in 2022, 7% more than the previous year, according to a 2023 report. The cost-of-living crisis has pushed the needle of wealth to a new high.

In some parts of the U.S., making around $200,000 isn’t even considered to be “rolling in it.” A household making $199,000 a year in Massachusetts and New Jersey would still be considered middle-class, according to a 2025 analysis of 2023 U.S. Census Bureau data. And in every single state in America, a $100,000 salary is no longer enough to be considered to be upper-class. 

There are several reasons why more six-figure earners are struggling to make ends meet. Some employees have been hit with wage deflation, and the prospect of switching jobs for better pay has been upended. Employees who stayed in their current roles received a 4.6% wage bump in January and February, while those who switched jobs received only a marginally higher increase of 4.8%, according to 2025 data from the Atlanta Fed. 

Also, inflation has increased living expenses across the board. People may assume a middle-class lifestyle could at least keep up with the basics, but 65% of those households say their incomes were falling behind the cost of living, according to a 2024 study from Primerica.

This story was originally featured on Fortune.com

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• OpenAI just raised $8.3 billion in a fresh round led by Dragoneer Investment Group. The AI startup is well on its way to raising $40 billion by year’s end.

Back in March, OpenAI announced a plan to raise up to $40 billion at a $300 billion valuation by the end of the year, with $10 billion becoming immediately available (thanks to SoftBank, which footed 75% of the bill), and the remaining $30 billion arriving by the end of the year.

On Friday, OpenAI made strong headway on its financial plans, raising another $8.3 billion at that same $300 billion valuation, the New York Times’ DealBook was first to report. Demand for the round was off the charts—five times oversubscribed, according to the NYT—which meant many early investors participating in the new round were reportedly frustrated by getting smaller allocations so OpenAI could prioritize new backers. 

OpenAI’s latest fundraising round was led by Marc Stad’s Dragoneer Investment Group, an early investor in Spotify and Uber. Dragoneer wrote a massive $2.8 billion check, which means OpenAI now represents roughly 10% of the firm’s funds.

The round also included new investors, including T. Rowe Price, as well as a pair of giants from the private equity world, TPG and Blackstone. Other participants in the round included Andreessen Horowitz, Sequoia Capital, Founders Fund, Fidelity Management, Thrive Capital, D1 Capital Partners, Coatue Management, and Tiger Global.

The New York Times’ DealBook reports OpenAI’s annual recurring revenue, which was reported as $10 billion in June, now exceeds $13 billion almost two months later, and may pass the $20 billion mark by year’s end. 

To offer some context: Anthropic, OpenAI’s nearest rival in terms of revenue and capital raised, has $14.3 billion in lifetime fundraising, and its valuation is $61.5 billion as of March—though it is currently in talks to raise another $5 billion at a $170 billion valuation. Perplexity AI, another rival, raised $100 million last month, bringing its valuation to $18 billion. Elon Musk’s AI company, xAI, has raised $10 billion at a reported $80 billion valuation, though current fundraising efforts could bring that number up to $200 billion. 

Of course, all of this money brings OpenAI closer to an initial public offering. The company is currently in the midst of restructuring itself to become a for-profit company (which requires a green light from Microsoft), so there is still no announced timeline for an IPO. But the latest round means OpenAI has raised more than any other AI company by a wide margin, which gives it the upper hand in the red-hot sector.

OpenAI might face a true challenge, though, from some of the more established Silicon Valley giants, such as Meta. CEO Mark Zuckerberg is pouring billions into AI resources, including talent; its $72 billion AI infrastructure spend is almost 80% higher than OpenAI’s entire fundraising round this year. Meta is also the sixth-most valuable company in the world with a market cap approaching $2 trillion.

OpenAI did not wish to comment further on the news, or on its future plans.

This story was originally featured on Fortune.com

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• Sales of the Nintendo Switch 2 are outpacing the original Switch. The company has sold 5.8 million units since launch and expects to hit the 15 million mark by the end of March. Software sales were strong as well. The original Switch is the best-selling console in the company’s history, beating the Wii, NES and SNES.

Demand for Nintendo’s Switch 2 is not slowing down.

The Kyoto-based company says it has sold 5.82 million units since the system went on sale in early June and demand continues to outpace supply in most locations. Nintendo says it’s on track to sell 15 million units by the end of its fiscal year (in March of 2026).

Should it achieve that goal, that will make the Switch 2 a faster seller than the original Switch, which went on to become Nintendo’s best-selling console system. (The original took a full calendar year to hit the 15 million mark.)

That led to a strong quarter for the company. Revenues more than doubled compared to a year ago, coming in at $3.8 billion. Profits topped $378 million. Officials say Nintendo is on track to early $12.6 billion this fiscal year.

To make up for Switch 2 shortages, Nintendo plans to boost production – as many people who have ordered one have yet to receive theirs.

It’s not just game systems that are selling well. Switch 2 software sold 8.67 million units in the quarter, with Mario Kart World and the highly-rated Donkey Kong Bananza both leading the charge.

The Switch 2 is backwards compatible with the original Switch, so software sales for that older system were even higher. Nintendo says it sold 24.4 million Switch games in the quarter – along with nearly 1 million of the older consoles.

This story was originally featured on Fortune.com

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•  Billionaire Microsoft cofounder Bill Gates says AI is moving at a speed that “surprises” even him,  as workers and employers are preparing for how the technology will impact their jobs. Leaders are already saying it’s just as good as workers, and is taking more jobs than are being created. 

Job seekers are scrambling to figure out when AI will come for their jobs—but even the experts can’t agree on a timeline. Now, Bill Gates is sounding the alarm: It could all happen so fast, workers won’t even have time to catch up.

“The question is, has it come so fast that you don’t have time to adjust to it?” Bill Gates just said in an interview with CNN.

The Microsoft cofounder noted that AI is already capable of taking over administrative roles like telesales, but it’s still falling short when it comes to more complex tasks—and even he’s dumbfounded by just how quickly it’s closing the gap.

“It’s improving at a rate that surprises me,” the tech pioneer, worth $122 billion, said in the interview, while pointing to its deep research capability as an example.

“A few times a day, I take some complex question, and just for fun, I see AI does an awfully good job gathering all the materials, and summarizing what I need to know.” 

In just a few years, the technology has gone from writing emails to generating functional code. That’s why no one can pin down when exactly the tipping point will come, Gates added.

“AI today can replace human work, the most complex coding tasks, [but] it’s not able to do [it] yet. And people in the field disagree: is that within the next year or two, or is it more like ten years away?”

Tech leaders agree that AI will be as good as human workers

Fellow business leaders have been candid that AI will be just as capable as, or even more advanced than, most human workers in the next few years.  

Anthropic CEO Dario Amodei predicted that up to 50% of entry-level white collar jobs could be replaced by AI within 5 years. 

“Most of them are unaware that this is about to happen,” Amodei warned in an interview with Axios. “It sounds crazy, and people just don’t believe it.”

Amazon CEO Andy Jassy also told employees that within the next few years, AI would reduce some corporate roles, like customer service representatives and software developers. And over at Meta, its CEO Mark Zuckerberg is already getting started on automating some of his employees’ jobs—the tech billionaire announced that the company is building an “AI engineer” to help with coding tasks.

That shift isn’t unique to just tech roles. IBM cut around 8,000 jobs this May in HR and other departments, as the tools take over routine administrative tasks. Instead, the company is hiring more engineers and salespeople, signaling a transition to more roles that require creativity and complex decision-making.

AI is improving productivity, Bill Gates says

As more companies pull back on hiring and training early job seekers, they are also shrinking the talent pool of future leaders. The jobs that have historically served as stepping stones for entry-level workers are under threat. 

With recent college grads struggling to land entry-level jobs, Gates weighed in on growing fears that AI is taking opportunities from young workers. He argued that rising productivity should free people’s time to do more of the other things they enjoy—from side hustles to vacations.

“When you improve productivity, you can make more [jobs],” Gates said.  “It means you can free up these people to have smaller class sizes or have longer vacations or help to do more, so it’s not a bad thing.”

New research echoes that already, 4 in 10 say it has provided better work-life balance, reduced stress, and improved decision-making.

This story was originally featured on Fortune.com

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• Miller Lite is celebrating its 50^th anniversary by giving away 50,000 beers in 500 bars around the country. The company is also offering free beer on its website to people that can’t make it to a bar in time. The giveaways will take place between 4:50 p.m. and 7:00 p.m. local time.

Aug. 1 is international beer day—and if your beer fridge happens to be empty, one major beer brand is happy to offer you a freebie today.

Miller Lite is giving away 50,000 beers at 500 bars around the country on Friday. (This also happens to be the beer brand’s 50^th anniversary.) Can’t get to a bar? The brand will also be offering a sweepstakes on its Website that’ll pick up the tab for fans.

To find which bars near you are handing out the free beers, head to millerlite.com/find-celebration. There’s no reason to plan on a liquid lunch, though, which should make HR departments happy. The giveaways will take place between 4:50 p.m. and 7:00 p.m. local time.

Alternatively, you can visit MillerLite.com, starting at 3:00 p.m. CT (4:00 p.m. ET) to enter a sweepstakes for free beers.

“The 50th anniversary is just more than a milestone for Miller Lite, it’s a celebration of our fans and the five decades we’ve spent together enjoying Miller Time,” said Ann Legan, vice president of marketing for the Miller family of brands.

To culminate the celebration, Miller will host a Beer Drop at its brewery in Milwaukee, much like the Times Square ball drop on New Year’s Eve. Only, in this case, it will be a larger-than-life six pack that descends, rather than a crystal-encrusted ball.

This story was originally featured on Fortune.com

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