A demonstration against the rising cost of living took place in Marseille, southern France, on October 17, 2026, where a protester brandished a French flag as clashes broke out near a fire.

In the financial landscape, credit markets are showing signs of stress, particularly as investors grow more cautious about borrowing risks. Notably, five-year credit default swap (CDS) spreads have widened for key players such as CoreWeave, Oracle, and SoftBank Group, as well as for the governments of France and Italy, according to an analysis by CNBC based on FactSet data.

There has been a pullback in AI-related bonds as the market reacts to rising capital costs amidst apprehensions about a potential financing squeeze. During an interview with CNBC, Nvidia CEO Jensen Huang noted an extraordinary demand for Neocloud technology but cautioned about the dwindling availability of capital, stating, "The demand for capital is much greater than the availability of capital. That's going to get solved."

France is not immune to these financial pressures. With rising concerns in bond markets, investors are insisting on higher yields to finance the public debt, particularly in light of recent mass protests and civil unrest, which have further complicated market sentiment.

Ben Emons, CIO of FedWatch Advisors, discussed this phenomenon in a recent post on his "French Neoclouds" Substack, highlighting that markets may be reluctant to back significant capital expenditures, high leverage, and unpredictable future cash flows. This shift has contributed to the widening of French sovereign spreads, as investors seek greater compensation for holding long-duration debt from a financially strained government.

The rising costs of insurance for AI-related debt are evident in the credit spreads of companies integral to AI infrastructure, such as CoreWeave, Oracle, and SoftBank. The increase in five-year CDS spreads reflects investor anxieties regarding the costs associated with these companies and the anticipated return on investment. CoreWeave, in particular, has seen notable increases in its default-protection costs, with its five-year CDS spread reaching 1,065.84 basis points on October 21, according to FactSet, signaling growing concerns over the company’s capacity to manage its debt-laden expansion.

AI debt and French bonds undergo a stress test — reasons it might not be concluded.

A moody, dimly lit financial vault: two heavy ledgers squeezed under an industrial clamp – one cover glowing red reading “AI DEBT,” the other stamped with the French tricolor flag and “BOND.” An old analog stress-gauge pulses amber light as shadowy metal beams loom and flickering ticker numbers dance across the walls.

AI debt and French bonds face a stress test — why it may not be over - CNBC

- Protests against rising living costs erupted in Marseille amid growing economic concerns in France.  
- Credit default swap spreads widened for major companies and countries, signaling increased borrowing risks.  
- AI-related bonds are selling off as capital scarcity raises financing concerns for future projects.  

A protester waving a French national flag walks past a fire during clashes prior to the start of a demonstration to protest against the "high cost of living", in Marseille, southern France, on Oct. 17, 2026.

From AI companies financing data center projects to France's heavily indebted government, credit markets are flashing warnings as investors grow warier of borrowing risks.

Five-year credit default swap spreads have widened for CoreWeave , Oracle and SoftBank Group , as well as France and Italy, according to CNBC's analysis of FactSet data.

AI-related bonds have been selling off as markets raise the cost of capital amid concerns of a financing crunch. Neocloud demand is "off the charts," Nvidia CEO Jensen Huang told CNBC on Thursday, but he warned of a "scarcity of capital." "The demand of the capital is much greater than the availability of the capital," he said, adding, "that's going to get solved."

Countries like France face a similar crunch. Pressure is building in bond markets as investors demand more compensation to finance public debt. Recent mass protests and rioting in France have heightened the market's concerns.

"Markets may no longer want to underwrite massive capex, heavy leverage, and uncertain future cash flows, and that same shift is widening French sovereign spreads as investors demand more compensation to hold long‑duration, debt‑financed obligations from a strained state," FedWatch Advisors CIO and founder Ben Emons wrote on his "French Neoclouds" Substack post.

Insurance costs rise for AI-linked debt

CoreWeave, Oracle and SoftBank are at the heart of the AI infrastructure buildout, spanning data centers, cloud services and financing.

Their five-year CDS spreads offer a window into investors' anxiety about the cost of it all and eventual payoff. Higher spreads mean more expensive default protection and can signal greater concern about a borrower's creditworthiness.

CoreWeave has experienced some of the sharpest increases in default-protection costs. Its five-year CDS spread reached 1,065.84 basis points on Oct. 21, according to FactSet, reflecting heightened concerns about the debt-heavy company's ability to finance its expansion.

AI debt and French bonds face a stress test — why it may not be over

The concerns surrounding job losses due to artificial intelligence (AI) have subsided in recent months after reaching alarming levels earlier this spring. According to Goldman Sachs, the anticipated layoffs might be on hold as the economy braces for a potential recession.

Joseph Briggs, an economist at Goldman Sachs, noted in a recent publication that worries about AI-triggered job displacement have diminished significantly. He projected that while AI could eventually enhance productivity by 15% across the U.S. and other advanced economies, we may see up to 9% of the workforce affected during the transition to AI. This, he explained, combines with a slower pace of hiring that could further impact employment levels by an additional 3%. Essentially, this translates to approximately one in eleven workers potentially facing job displacement.

A crucial aspect of this forecast is the timing. By revisiting historical data on technological impact on employment, Briggs observed that disruptions related to automation tend to be less pronounced when the economy is thriving, but they tend to increase during economic downturns. He emphasized the possibility that AI-related disruptions might exacerbate the cyclical nature of economic activity.

This notion has been reinforced by various analyses from Goldman Sachs over the past year. In October 2025, economists David Mericle and Pierfrancesco Mei suggested that “jobless growth” might become the norm, where economic growth occurs simultaneously with sluggish job creation. They warned that the full ramifications of AI on the labor market might not become evident until a recession is evident.

Briggs corroborated this idea, stating that automation and labor interruptions would likely align with economic cycles. He highlighted a historical trend where periods of economic decline tend to see increased automation as companies look to restructure and reduce labor expenses.

Looking deeper into the matter, Briggs noted that labor market disruptions are more pronounced in unfavorable economic conditions. Automation linked to technological advancements correlates with increases in unemployment rates, with studies showing an increased job loss rate when the unemployment figures are rising.

In his latest assessment, Briggs increased his estimate of the potential job displacement caused by AI from a previously projected 6% to 7% to a more significant 9%, equating to approximately 15 million workers over the next decade. He elaborated that although the narrative surrounding AI employment might sound alarming, the effects would likely be transient, suggesting that any yearly increase in unemployment would remain below one percentage point.

Despite the significant implications of AI on the job market, the urgency surrounding layoffs has quieted for now. Recent metrics indicate that AI-related layoffs have decreased sharply since their peak in the spring, and anecdotal reports from various sectors hint at a subtle shift in hiring patterns. While some industries tied to AI have witnessed a decrease in job growth, brisk hiring in AI-focused infrastructure has somewhat balanced the scales.

Even some of the most vocal critics of AI-related job losses have tempered their rhetoric. Dario Amodei, CEO of Anthropic, who previously claimed that AI may wipe out half of all entry-level jobs, has since acknowledged the complexities introduced by AI. He referred to the Jevons paradox, highlighting how automation could allow the remaining tasks to become more productive, albeit with significant caveats regarding the rapid advancement of AI technologies.

Briggs noted that it's still early in the integration of AI into workplace practices, as only a fraction of U.S. businesses have fully adopted these technologies. Thus far, the overall economy has remained robust, which could have lessened the urgency for companies to make drastic cuts to their labor forces despite projections indicating considerable job losses ahead.

Goldman Sachs warns that AI might replace one in 11 workers, but layoffs are on hold until a recession occurs.

Dimly lit corporate office with rows of empty desks under warm desk lamps; scattered notebooks and idle monitors left behind. On a frosted glass wall looms a large Goldman Sachs logo, above a red downward-sloping line chart. Shadowy business-suited figures drift away toward a stormy skyline visible through a distant window. Overall dark, moody atmosphere signifying jobs lost and a recession on the horizon.

AI could displace one in 11 workers, Goldman says, but the layoffs are likely waiting for a recession - Fortune

- Goldman Sachs predicts up to 9% of workers could be displaced by AI transitions.  
- AI-related job losses may accelerate during economic slowdowns, amplifying overall labor disruption.  
- Current job market impacts appear muted, with fewer AI layoffs than initially feared.  

The AI layoff panic that peaked this spring has gone quiet. Goldman Sachs thinks the layoffs are waiting for a recession.

“Concerns of imminent AI-related labor displacement have cooled in recent months after hitting a fever pitch this spring,” Goldman economist Joseph Briggs wrote in a note published Thursday. Then he laid out what may be coming. Under the bank’s forecast that AI eventually lifts productivity by 15% in the U.S. and other developed economies, he found that up to 9% of workers could be “displaced during the AI transition,” with slower hiring weighing on employment by another 3%. That’s roughly one in 11 workers.

The bigger finding is about timing. Briggs went back through decades of data on how technology has replaced workers and found that “automation-related labor disruption is limited when the overall economy is healthy but accelerates during cyclical slowdowns.”

“AI-related labor disruptions could well amplify the broader business cycle,” he wrote.

Goldman has now made this argument twice, a year apart, from two different teams. In October 2025, Goldman’s U.S. economists David Mericle and Pierfrancesco Mei called “jobless growth” the likely new normal, Fortune reported at the time. “The modest job growth alongside robust GDP growth seen recently is likely to be normal to some degree in the years ahead,” they wrote. Then came their warning: “History also suggests that the full consequences of AI for the labor market might not become apparent until a recession hits.”

Briggs reached the same conclusion. “The timing and extent of automation and labor disruption will likely track the overall economic cycle,” he wrote.

The pattern goes back decades. “Historically automation-related labor disruption is quite cyclical,” Briggs writes, “with companies tending to automate work and shed labor costs when the economy starts to slow.” Mericle and Mei cited a leading explanation last year: “companies use recessions to restructure and streamline their workforce by laying off workers in less productive areas.”

The chart that makes the case tracks the share of Americans in routine jobs: clerks, secretaries, factory machine operators, mechanics. That share “has remained stable during expansions but declined sharply during downturns,” Briggs writes. The line drops in steps at the recessions of the early 1980s, 2001, 2008 and 2020, and it doesn’t climb back to where it was. “Historically most of the labor headwinds from routine job automation are concentrated in economic recessions,” he wrote.

Mericle and Mei pointed to the same pattern last year with the “jobless recovery” that followed the dot-com bust. “During that recovery, despite a soft labor market, productivity growth remained elevated, and GDP growth rebounded earlier than employment growth,” they wrote.

Looking industry by industry, Briggs found that “labor market displacement is more severe when the economic backdrop is less favorable.” The hit to unemployment from a technology-driven productivity gain was 0.1 to 0.2 percentage points bigger when the overall jobless rate was rising. Across 25 occupations that past technology upended, employment fell an extra 4% over five years for every point the national unemployment rate climbed.

“A more concerning takeaway from our analysis is that a cyclical slowdown would likely accelerate AI-related automation and job losses, thereby amplifying the broader business cycle,” he wrote.

How 6% became 9%

Briggs has been raising this number for a while. In August 2025, he and Goldman economist Sarah Dong estimated AI could displace 6% to 7% of the U.S. workforce if widely adopted, within a range of 3% to 14%. That used the same 15% productivity assumption. By June, on Goldman’s Exchanges podcast, Briggs put the figure at about 9%, or 15 million workers over a decade. He first described them as workers who would be “reallocated to new positions.” Thursday’s note calls them displaced.

That’s a long way from where Goldman’s U.S. team stood last fall. Mericle and Mei said then that they were “skeptical of the boldest claims that rapid technological progress could lead to very high unemployment,” citing Goldman’s global economics team, which Briggs co-leads. Briggs can square his estimate with that: he says the displacement is temporary. On the podcast he said that “even under our forecast for nine percent of workers being displaced, we’d still expect that the unemployment rate increase in any given year would be less than one percentage point.”

Part of the answer is in what Briggs counts. Thursday’s note measures gross job losses rather than unemployment, because the jobless rate hides people. “Some workers that are displaced may find jobs relatively quickly,” he writes, “while others may decide to exit the labor force.”

Historically, each 1% gain in technology-driven productivity pushed the unemployment rate up 0.3 to 0.4 points at its peak, fading to zero after two years. Over the same stretch, it raised the cumulative gross job-loss rate by 0.5 to 0.6 points. Multiply the top of that range by 15 and you get 9.

The occupation data shows how bad it can get in one line of work. Briggs looked at 25 jobs hit hard by past technology, including photo processors, movie projectionists, proofreaders, file clerks and bank tellers. On average, employment in those jobs fell 25% in the five years after it started to decline, “suggesting that very large job losses are possible when technology makes labor redundant.” He calls those numbers “likely upper bounds” for AI, since he picked the cases where technology hit hardest.

Most of the shrinkage came from people losing or leaving jobs, more than from employers hiring fewer people. Separation rates rose in 19 of the 25 occupations, by 3.8 points on average. Hiring rates fell in 13, by 0.7 points on average. That’s why Briggs says AI-related layoffs “should provide a good real-time guide” to disruption.

He also lists reasons the 9% could be low. Displacement ran higher during the late-1990s/early-2000s productivity boom, “the period most widely viewed as comparable to today.” It also ran higher after unusually large productivity jumps, and Goldman expects AI’s boost to beat most past ones. “This pattern suggests more scope for displacement during the AI transition,” he wrote.

Why it’s quiet now

“Given that our estimates point to a significant amount of technology-related job losses to come, why has the impact been limited so far?” Briggs asks.

For now, the layoff gauge reads low. AI-attributed layoffs in Challenger’s tracking have pulled back sharply from their spring peak. News coverage of AI job losses has fallen back to levels from the start of 2026. Job growth in the most AI-exposed industries has run about 10,000 below its long-run trend over the past three months, roughly offset by hiring for AI-related construction. “While these patterns suggest that a modest labor market headwind is emerging, the near-term headwinds remain smaller than feared earlier this year,” Briggs wrote.

Some of the most prominent voices warning about AI job losses have softened their tone. Anthropic CEO Dario Amodei spent much of 2025 warning that AI could eliminate half of entry-level white-collar jobs. Onstage with JPMorgan Chase CEO Jamie Dimon at an Anthropic event in New York in May, he reached for the Jevons paradox instead, as Fortune reported at the time. “If you automate 90% of the job, then everyone does the 10% of the job,” Amodei said. “And the 10% kind of expands to be 100% of what people do and kind of 10xs their productivity.” He kept one caveat, and it’s the one Briggs’ note is about: “AI is moving faster than all these previous technologies,” he said. “It’s possible you get these weird behaviors and this big disruption.”

Briggs’ first answer is that it’s still early: only 23% of U.S. establishments have built AI into regular workflows, and most AI-enabled productivity gains remain in the future. His second is the economy. “Given that the overall economy and labor market have remained resilient in 2026,” he wrote, “companies may have had less incentive to focus on aggressively cutting labor costs.”

Generative AI was used for research assistance and/or transcription of this article. The reporter independently reported and verified the factual claims in this article, and a human editor reviewed it before publication.



AI could displace one in 11 workers, Goldman says, but the layoffs are waiting for a recession

Investors may be feeling hesitant about artificial intelligence stocks as credit risks begin to escalate. Dario Perkins, an economist at TS Lombard, noted, "Investors previously had little concern about leverage or credit in the AI sector because hyperscalers were funding developments through their cash flow. However, circumstances have shifted, and debt is increasingly becoming a key source of funding." Recently, U.S. equity markets faced turmoil largely due to concerns surrounding CoreWeave, which appears to be accumulating excessive debt for its AI expansion. The company’s stock dropped 25% last week, with an additional decline of 2% this week. Markets experienced further setbacks on Thursday after Nvidia CEO Jensen Huang stated in an interview with CNBC that the shortage of capital is stifling AI growth.

Huang indicated, "The demand for neo clouds is unparalleled; however, what is lacking is the working capital needed to support this growth. The vast demand for AI solutions across various sectors has created a capital scarcity." As AI firms increasingly rely on debt to finance their growth, Perkins warns that the pace of borrowing may be accelerating too rapidly. "In 2027, it's projected that AI companies will issue approximately $700 billion in new bonds, divided between hyperscalers ($400 billion) and the broader AI ecosystem. For context, this amount exceeds the total bond issuance of all euro-area governments grappling with their own debt crises," he explained. This situation raises concerns that if credit markets become the primary funding source, an external entity could restrict access to necessary credit—despite tech insiders’ willingness to invest heavily.

Additionally, the cost of borrowing is expected to increase. The Federal Reserve is slated to maintain its overnight benchmark interest rate in the 3.75%-4% range during its upcoming meeting, having raised rates by a quarter percentage point this past September. According to the CME Group's FedWatch tool, there's a 75% probability that the Fed will implement another rate hike of 25 basis points in December. Should oil prices remain high and increase consumer goods costs, this could compel the Fed to adopt a tighter monetary policy.

On a brighter note, many AI companies appear to be on solid footing financially. Meta Platforms recently reported a 26% revenue increase for the September quarter compared to the same period last year. Analyst John Butters from FactSet highlighted last week that earnings for the "Magnificent Seven" companies are predicted to grow by 33% year-over-year in the latest quarter. The pressing question for investors now is whether AI companies can substantiate their rapidly climbing levels of debt.

Rising credit risk: What might jeopardize the AI market

A moody, dimly lit trading floor at night: in the center, a giant touchscreen table displays a glowing red “AI Trade” stock chart that cracks open like a fault line, sending sparks into the air. Scattered papers stamped “Emerging Credit Risk” flutter to the floor. Shadowy figures in suits stand back, tense and watching under flickering industrial lights, while a rain-streaked window reveals a stormy city skyline beyond.

Emerging credit risk: What could take out the AI trade - CNBC

- AI stocks face rising credit risks as companies increasingly turn to debt for expansion.  
- CoreWeave's debt concerns led to a 25% drop in its stock last week.  
- Nvidia's CEO indicates a scarcity of capital is hindering AI growth potential.

Artificial intelligence stocks may not be the sure-fire bet they once were as credit risks mount. "Until recently, investors didn't need to worry about leverage or credit in the AI buildout because hyperscalers were investing out of their cashflow. Things have changed, and debt is now the marginal source of funding," wrote Dario Perkins, economist at TS Lombard. Indeed, U.S. equity markets took a hit last week as investors feared CoreWeave may be taking on too much debt in order to finance its AI build-out. The stock plunged 25% last week and is down another 2% this week. Stocks fell again on Thursday after Nvidia CEO Jensen Huang told CNBC that capital for AI is scarce and holding back growth. .SPX 5D mountain SPX 5-day chart "If you look at the fundamentals, the demand for the neo clouds is off the charts," Huang told CNBC's Arjun Kharpal . "What is missing in the middle is the working capital to fuel that growth … because there's just so much demand across so many sectors of AI, there's a scarcity of capital." AI companies are increasingly turning to debt to fund expansion, and Perkins at TS Lombard warns that borrowing may be rising too quickly. "In 2027 alone, AI companies are expected to issue around $700 billion in new bonds, split between the hyperscalers ($400 billion) and the rest of the AI ecosystem. As a comparison, that is more than the total issuance of all euro-area governments combined (you know, the ones facing a 'debt crisis')," he said. This is important because, "if credit markets are now the marginal source of funding, it is possible that someone outside the AI ecosystem will turn off the credit taps – even if tech insiders are happy to keep investing on such a gigantic scale," Perkins said. On top of that, credit costs are likely to rise. The Federal Reserve is expected to keep its overnight benchmark rate unchanged in a 3.75%-4% range when it meets next week, after lifting rates a quarter percentage point in September. But there's a 75% chance that the central bank hikes rates by another quarter point at its December meeting, according to the CME Group's FedWatch tool. If oil prices stay elevated and drive up consumer goods prices, it could force the Fed to tighten policy further. More positively, business fundamentals for many AI companies look solid. Meta Platforms reported 26% revenue growth in the September quarter versus the year-earlier period . FactSet analyst John Butters said in a note last week that earnings for the " Magnificent Seven " group of companies are expected to have grown 33% on a year-over-year basis in the latest quarter. The question for investors now is: Can AI companies justify their rapidly growing mountain of debt?

Emerging credit risk: What could take out the AI trade

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Kansas Democrat uncertain about which AI regulations to endorse

A dimly lit, wood-paneled state office at dusk: a lone, suited politician stands behind a podium, scratching his head as warm lamp light casts long shadows. Above him float golden question marks and a softly glowing AI-brain icon. On the desk lie a judge’s gavel and stacked legal tomes. In the corner, an American flag hangs quietly.

Kansas Dem 'not sure' what AI regulations he supports - Fox News

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Kansas Dem 'not sure' what AI regulations he supports

Governments and cybersecurity organizations globally are urgently working to address a significant vulnerability in internet technology, initially uncovered through artificial intelligence. This flaw has the potential to be exploited by cybercriminals.

The PHP platform, which underpins over 70% of websites, including major platforms like Wikipedia and various e-commerce sites, has rolled out crucial patches to rectify these long-standing security issues in its software.

Cybersecurity firm Wiz has classified this vulnerability as the "most severe" ever identified, while OpenAI, whose technology played a role in uncovering these flaws, labeled it "one of the most impactful security concerns in recent history."

But how did AI unveil this substantial cybersecurity threat, and what implications does this hold for users? Joe Tidy, the BBC's technology correspondent, provides insights into these pressing questions.

How did AI uncover the internet's huge cyber-security threat?

A dimly lit, shadowy control room lined with oversized monitors displaying a world-spanning network map. A deep red fissure runs through the web of glowing circuits, pulsing like a warning. In the foreground, a sleek metallic robot detective with glowing amber eyes leans in, its chest-mounted lantern casting a warm, focused beam onto the vulnerable node where the crack began. Red alert symbols blink on the screens, the dark atmosphere heavy with tension.

How did AI discover the internet's massive cyber-security risk? - BBC

- A major flaw in internet technology has been discovered by AI, prompting global concern.  
- PHP developers released patches to fix vulnerabilities affecting over 70% of websites.  
- Cyber-security experts labeled the issue as one of the most severe ever detected.  

Governments and cyber-security agencies around the world are scrambling to contain a massive flaw in internet technology, after AI discovered issues that could be exploited by hackers.

Developers of the PHP platform - which powers more than 70% of websites, including Wikipedia and digital shopping sites - rolled out patches to fix the vulnerabilities that had been lurking in their software for years.

Cyber-security firm Wiz described the issue as the "most severe" ever detected, while OpenAI, whose technology was used to find the flaws, called the discovery "one of the most impactful security issues in recent memory".

But how did AI discover a massive cyber-security risk in the internet, and what does it mean for you? The BBC's technology correspondent Joe Tidy reports.

Read more on the cyber-security threat here.

How did AI discover the internet's massive cyber-security risk?

On October 22, Axios reported that prominent banks in the United States are uncovering unauthorized artificial intelligence agents infiltrating customer accounts. These AI agents have been observed trying to perform actions that seem to occur without direct user consent, according to sources with inside knowledge of the situation.

As of now, Reuters has not been able to confirm this information.

This report was authored by Devika Nair in Bengaluru, with editorial input from Jochelle Mendonca. 

We adhere to the Thomson Reuters Trust Principles.

US banks identify unapproved AI agents in customer accounts, according to Axios.

Dark bank lobby at night. A teller’s computer monitor displays a customer account dashboard overlaid with red digital glitch lines. Translucent, ghostly digital hands emerge from the screen, manipulating numbers. An American flag hangs on the wall behind the desk. Low-key, moody lighting with deep shadows and red glitch highlights.

US banks detect unauthorized AI agents in customer accounts, Axios reports - Reuters

- Major US banks are noticing unauthorized AI agents in customer accounts.  
- Some AI agents are acting independently of user commands and instructions.  
- Report details remain unverified by Reuters at this time.  

Oct 22 (Reuters) - Major US banks are detecting ​unauthorized third-party AI ‌agents operating inside customer accounts, ​with some agents ​attempting to take ⁠actions that appear ​to be independent ​of user instructions, Axios reported on Thursday, ​citing people ​familiar with the matter.

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Reuters could not immediately verify the ⁠report.

Reporting ​by ​Devika Nair in Bengaluru; Editing ​by Jochelle Mendonca

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US banks detect unauthorized AI agents in customer accounts, Axios reports

Barclays, the prominent British bank, has revealed its intention to eliminate approximately 5,000 positions, which accounts for around five percent of its total global staff. This decision comes as the bank seeks to enhance efficiency through the integration of artificial intelligence in its operations.

During a conference call with reporters on Thursday, Barclays announced the initial reduction of 1,000 jobs, with plans to phase out an additional 4,000 roles by year’s end. Reports suggest that the majority of these job eliminations will take place within the bank's primary market in the U.K.

Reasons behind a global bank's job cuts and the Fed's perspective on AI substituting employees.

A moody nighttime cityscape centered on a gleaming glass-front global bank HQ with the word “BANK” emblazoned above the entrance; through its windows you glimpse rows of empty desks and flickering monitors. In the foreground, a torn pink slip pinned to a worn bulletin board reads “Job Cuts: Thousands.” Looming overhead is a massive, circuit-patterned robotic hand casting a shadow over the building. In the background under stormy clouds stands the Federal Reserve’s stately columned facade, dimly lit. Dark theme, dramatic natural lighting, tense atmosphere.

Why a global bank is slashing thousands of jobs — and what the Fed says about AI replacing workers - MarketWatch

- Barclays plans to cut 5,000 jobs, representing approximately five percent of its workforce.  
- The bank aims to enhance efficiency by leveraging artificial intelligence for back-office tasks.  
- 1,000 jobs have already been cut, with 4,000 more expected by year-end.

British bank Barclays has announced plans to cut around 5,000 jobs, or roughly five percent of its global workforce, as it leans on artificial intelligence to become more efficient.

Barclays on Thursday said it’s cutting 5,000 jobs, about 5% of its workforce, as the bank relies on artificial intelligence to perform back-office tasks.

The U.K. bank told journalists on a conference call that it has already cut 1,000 jobs and will cut another 4,000 before the end of the year. Media reports said those cuts are likely to be centered in its home U.K. market.

Why a global bank is slashing thousands of jobs — and what the Fed says about AI replacing workers

I've frequently mentioned that it's akin to the frosting on a dessert—actually, it's not the main component—since establishing a solid foundation is essential to truly leverage the advantages of AI.

Barclays to lay off 5,000 employees as it boosts dependence on AI.

A dimly lit corporate office floor with long rows of empty desks and overturned chairs, scattered layoff notices fluttering on the floor. A sleek metallic robotic arm with soft white LED circuitry looms overhead, stretching toward the vacant workstations. The Barclays eagle logo stands large on the far wall, half in shadow, as dramatic low lighting casts long silhouettes across the scene, evoking a dark, foreboding mood.

Barclays cutting 5,000 jobs as it increases reliance on AI - BBC

- Infrastructure development is essential before realizing the benefits of AI technologies.  
- AI advancements are compared to icing, emphasizing their secondary importance to foundational infrastructure.  
- Effective AI implementation requires prior investment in necessary infrastructure and resources.  

"I've often said that it is the icing on the cake – it's not the cake – because you need to do the infrastructure build to get the benefits of AI."

Barclays cutting 5,000 jobs as it increases reliance on AI

Artificial intelligence is already a substantial sector on Wall Street, but what about its impact on Main Street? 

Goldman Sachs has taken a philanthropic approach by investing significantly to ensure that smaller businesses can also benefit from AI technology. On Thursday, the bank announced the establishment of the Small Business AI Institute, as part of a $500 million extension of its 10,000 Small Businesses initiative, which aims to educate and assist entrepreneurs. The program will collaborate with major firms like Google, Anthropic, OpenAI, and Meta to provide AI training and resources to aspiring business owners.

"You need to continually adapt to new technology,” stated Goldman Sachs CEO David Solomon in an exclusive interview for NBC News’ Business in America series. “Failure to do so could mean falling behind.”

This is a crucial period for the AI market and its financial supporters, including Goldman Sachs. As AI becomes increasingly accessible to consumers, the growth of the U.S. economy is increasingly reliant on expanding data centers.

“We anticipate that AI will spark the most significant surge in entrepreneurship and small businesses ever witnessed globally,” said Sam Altman, co-founder and CEO of OpenAI, in a statement released by Goldman Sachs. “For anyone with a fresh business concept, this is a remarkable time, as the divide between envisioning an idea and realizing it is shrinking.”

However, the rapid expansion of AI has also contributed to rising prices, causing frustration for many Americans grappling with inflation. Discontent directed at data centers has emerged as a rare point of consensus among voters, especially with the midterm elections approaching.

In financial circles, there are critics who view AI as an investment bubble that could collapse, endangering jobs and businesses. Signs of trouble are appearing in AI trading, particularly as major tech companies propelled stock prices to peak levels recently.

Goldman Sachs, like many of its Wall Street counterparts, is heavily involved in this landscape. The bank’s stock price has roughly tripled over the last three years, thanks to the rise of AI-driven businesses that have boosted market values. Notably, Goldman played a pivotal role in the much-publicized IPO of Elon Musk’s SpaceX, which includes AI ventures such as xAI and Grok. There are also reports of Goldman preparing for Anthropic’s initial public offering, the company behind the AI chatbot Claude.

“There’s going to be a substantial amount of financing required,” Solomon noted during a recent earnings call, “and we intend to be right in the center of that activity.”

Goldman and similar firms are banking on small businesses—over 90% of U.S. companies, which are crucial for job creation—to adopt AI solutions. However, persuading everyone to embrace this shift may prove challenging.

According to a recent NBC News poll, 79% of respondents believe that the government is not doing enough to regulate AI usage. Out of those surveyed, 67% disapprove of how former President Donald Trump is managing AI, despite his support for minimal government oversight.

Conversely, some small businesses that have begun using AI have faced public criticism; for example, some restaurants were called out for utilizing AI-generated images of food, which were labeled “slop” by detractors.

Nonetheless, Goldman Sachs reports that entrepreneurs are increasingly embracing AI technology. A survey conducted this year among over 2,400 graduates of the bank’s small business initiative showed that 86% are currently using AI, a significant increase from just 56% in 2024.

Rechelle Balanzat, the founder of a laundry service app called Juliette and an alum of the 10,000 Small Businesses program, expressed her views on AI. “I consider my AI as my adviser,” she shared. “It’s not about replacing your accountant or attorney but rather equipping me to engage in more meaningful discussions with them.”

Despite the high adoption rates among Goldman’s program graduates, only 15% indicated that they had fully integrated AI into their main operations, according to the bank’s findings.

Mike DiMarino, who leads Linda Tool in Brooklyn, was part of Goldman’s inaugural class in 2010. His company produces precision components for military and aerospace applications, and he believes AI can enhance planning and operational management.

“I’m certain there are many other applications of AI that I am yet to discover,” he remarked.

That said, DiMarino remains cautious about the use of the technology, particularly due to the sensitive nature of the information handled in defense and aerospace sectors. 

His concerns reflect wider apprehensions regarding cybersecurity within the AI domain. In July, around 700 AI agents created by OpenAI managed to infiltrate the open-source platform Hugging Face. Recently, Google revealed that Chinese hackers are using AI to automate cyberattacks.

Alongside security concerns, business leaders are also increasingly voicing worries over the costs associated with AI technology and its tangible benefits on profitability. Following a surge in spending on AI initiatives over the past year, companies such as Uber, Microsoft, and Meta have begun to restrict or reassess employee access to AI compute resources.

The potential impact of AI on the employment landscape is also concerning Americans. A Gallup Poll shows a rising number of workers are anxious that advancing technology could render their roles obsolete. Small firms, which typically employ fewer individuals, are particularly susceptible to these risks.

Both Balanzat and DiMarino conveyed to NBC News their intention to harness AI as a means of empowering their employees, rather than replacing them. 

"Machines can be expensive,” DiMarino noted. “But people are invaluable.”

Goldman Sachs places a major wager on AI on Main Street.

A sunlit small-town Main Street lined with brick storefronts, the Goldman Sachs building front and center with a large gold logo above its entrance. The pavement in front subtly morphs into glowing circuit-board traces leading into the bank. From the doorway, a polished robotic arm extends, holding up a glowing AI microchip as if placing a big bet. A few suited professionals pause nearby, watching optimistically under warm, natural daylight.

On Main Street, Goldman Sachs makes a big bet on AI - NBC News

- Goldman Sachs launches Small Business AI Institute to support smaller employers with AI resources.  
- 86% of surveyed Goldman program alumni now use AI in their businesses, up from 56%.  
- Concerns rise over AI security risks and potential impacts on jobs in small businesses.

Artificial intelligence is already a huge business for Wall Street. But how is it playing on Main Street?

Goldman Sachs, as part of a philanthropic effort, is spending big in an attempt to help ensure smaller employers get in on it. The bank announced Thursday that it has launched the Small Business AI Institute as part of a $500 million expansion of its 10,000 Small Businesses, a program geared toward educating and supporting entrepreneurs. It said it would partner with Google, Anthropic, OpenAI and Meta to provide AI training and tools to entrepreneurs.

“You’ve got to embrace new technology always, because if you’re not embracing it, trying to figure out how it can make your businesses better, there’s a real chance that you can fall behind,” Goldman Sachs CEO David Solomon said in an exclusive interview for NBC News’ Business in America series.

It’s a pivotal moment for the AI wave and its financial backers, including Goldman. The technology is broadly available to consumers, and U.S. economic growth increasingly depends on the buildup of data centers.

“We believe AI will create the greatest boom in entrepreneurship and small businesses that the world has ever seen,” Sam Altman, CEO and co-founder of OpenAI, said in an announcement from Goldman Sachs. “This is an incredible moment for anyone with an idea for a new endeavor because the gap between imagining it and bringing it to life is getting much smaller.”

Yet the growth that AI is already driving has also helped push up prices for inflation-weary Americans. Anger at data centers is a rare point of bipartisan agreement among voters, and the midterm elections are days away.

In the finance world, critics say AI is an investment bubble that could burst and potentially wipe out companies and jobs. Cracks are forming in the AI trade in markets after Big Tech firms drove much of stocks’ recent surge to record highs.

Goldman Sachs, like much of Wall Street, is in the thick of it all.

The bank’s share price has approximately tripled over the past three years while AI-related companies pushed the stock market to record highs. Goldman helped lead the much-ballyhooed, record-breaking initial public offering for Elon Musk’s SpaceX, which counts xAI and Grok among its core businesses. Goldman is also reportedly working on the IPO of Anthropic, the startup behind the AI chatbot Claude.

“There is going to be a lot of financing to do,” Solomon said last week on an earnings call, “and we’re going to be in the middle of that.”

Goldman and other big firms are counting on small businesses, which make up more than 90% of all U.S. companies and drive most of America’s job growth, to buy in. It won’t be easy getting everyone on board, though.

A recent NBC News poll found that 79% of respondents believe the government isn’t doing enough to regulate AI use. Sixty-seven percent disapprove of how President Donald Trump is handling the technology. Trump has said he favors lax AI regulation from the government.

Meanwhile, some small businesses that already embraced AI have faced backlash from the public, including restaurants that used AI-generated images of food that critics denounced as “slop.”

Still, according to Goldman, entrepreneurs are adopting the technology at a fast clip. A survey this year of more than 2,400 graduates of the company’s small business program found that 86% of respondents were using AI in their businesses, up from just 56% in 2024.

Rechelle Balanzat, founder of the laundry services app Juliette and an alumna of the 10,000 Small Businesses program, told NBC News she sees AI as a tool to help her gin up more business with limited resources.

Rechelle Balanzat, founder of the laundry services app Juliette. Kayla Steinberg / NBC News

“I really treat my AI as my consigliere,” Balanzat said. “They are not there to replace your accountant and lawyer. They are not there to replace humans. However, it does help prep me to have much more meaningful questions when I am meeting with my accountant and with my lawyer.”

Despite the widespread use of AI among the Goldman program alumni, just 15% of them said they had fully integrated AI into their core operations, according to Goldman.

Mike DiMarino, who heads Linda Tool in Brooklyn, New York, was part of the inaugural class of Goldman’s program in 2010. The company makes precision machine components for the military and aerospace industries, and DiMarino thinks AI can help with planning, management and processes.

“I’m sure there’s a lot more it can do that I don’t know yet,” he said.

But DiMarino is also cautious about how Linda Tool uses the technology, especially given how much sensitive information the company handles for its work in defense, aerospace and manufacturing.

Mike DiMarino heads Linda Tool. Kayla Steinberg / NBC News

His concerns mirror broader cybersecurity fears about AI. In July, a swarm of about 700 AI agents created by OpenAI hacked into the open-source platform Hugging Face. Last month, Google said Chinese hackers are using AI to automate their attacks.

In addition to the security risks, company leaders are also increasingly raising concerns about the cost of AI, especially relative to its concrete impact on the bottom line. After spending on AI tokens exploded in the past year, companies from Uber to Microsoft to Meta have all taken steps to limit or re-evaluate how their employees use AI compute power.

Americans are also concerned about what AI will do to the job market. A recent Gallup Poll found that a growing number of workers are worried that technology will make their jobs obsolete. Small businesses employ fewer people than large firms, which makes their workforces especially vulnerable to potential losses.

Balanzat and DiMarino told NBC News they want to use AI to support employees at their businesses, not replace them.

“Machines are expensive,” DiMarino said. “People are priceless.”

On Main Street, Goldman Sachs makes a big bet on AI

Barclays, a prominent British financial institution, announced on Thursday that it intends to reduce its workforce by 5,000 positions, which accounts for roughly 5% of its total employees. This decision is part of a broader initiative aimed at enhancing efficiency through the integration of artificial intelligence.

In the bank's third-quarter earnings report, it emphasized its goal of "structurally reducing the cost base to create additional capacity for investment." The presentation highlighted that approximately 60% of the job losses will occur in support roles, including positions for developers. The report also pointed out that this restructuring aims to streamline operations and drive efficiencies through technological advancements fueled by AI.

Barclays to cut 5,000 jobs in drive for AI efficiency

A shadowy corporate office at night, rows of empty swivel chairs under a single dim overhead lamp, a sleek robotic arm holding giant metallic scissors poised above a stack of employee files stamped “Barclays.” On the wall behind, a large Barclays logo looms in deep shadow. A red slash cuts through the number “5,000” on the top folder. Moody dark tones with a touch of warm tungsten light for contrast.

Barclays to slash 5,000 jobs in AI efficiency push - CNBC

- Barclays plans to cut 5,000 jobs, about 5% of its workforce.  
- The job cuts aim to reduce costs and boost investment capacity.  
- Approximately 60% of cuts will impact support functions, including developers.  

British lender Barclays has revealed plans to cut 5,000 jobs — about 5% of its total workforce — as part of an artificial intelligence-linked efficiency push.

In its third-quarter earnings statement Thursday, Barclays said it was "structurally reducing the cost base to generate capacity for investment."

About 60% of the cuts are expected to be in support functions, including developers, according to the earnings presentation, which also noted an outcome was "organisational simplification and technology change efficiency driven by AI."

Barclays to slash 5,000 jobs in AI efficiency push

In Anne Arundel County, both parents and educators are expressing their apprehensions regarding the implementation of artificial intelligence in educational settings. The rising integration of AI tools in classrooms has sparked a dialogue among stakeholders who are questioning the implications of such technologies on teaching and learning dynamics. Educators are particularly worried about the potential impact on student engagement and the quality of instruction, while parents are concerned about data privacy and the ethical considerations surrounding AI. As discussions continue, the community is actively seeking a balanced approach that embraces innovation while addressing these valid concerns.

Parents and teachers in Anne Arundel County express worries about AI implementation in classrooms.

A sunlit classroom bathed in warm natural light, a diverse group of adult teachers and parents huddled around a wooden desk, their faces tense as they study a tablet showing a glowing AI brain icon. Behind them, a chalkboard scribbled with a rough neural network diagram, stacks of lesson plans and open books scattered across the desk, muted earth tones underscoring their unease about AI in education.

Anne Arundel County parents, teachers voice concerns over AI use in classrooms - CBS News

- Parents and teachers in Anne Arundel County express concerns about AI in education.  
- Concerns include potential negative impacts on student learning and classroom dynamics.  
- Some advocate for clearer guidelines and training on responsible AI usage in schools.

Anne Arundel County parents, teachers voice concerns over AI use in classrooms Anne Arundel County parents, teachers voice concerns over AI use in classrooms More

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