California continues to lead in artificial intelligence innovation, housing 33 of the world’s top 50 private AI firms. It remains unmatched in its proactive measures aimed at enhancing technology safety, security, and consumer privacy. In line with this commitment, the state's latest executive order furthers a robust strategy designed to establish sensible regulations while fostering innovation within this rapidly evolving sector.
In 2023, Governor Newsom positioned California as the pioneer in Generative AI policy by issuing an executive order focused on the responsible adoption of this technology in state operations while assessing its associated risks. To inform this important initiative, the Governor gathered renowned academic experts to produce the California Report on Frontier AI Policy, which offered key policy suggestions that culminated in the passage of the Transparency in Frontier Technology Act (Senate Bill 53, Wiener). This landmark legislation is the first of its kind in the U.S. and has inspired similar measures in other states.
Additionally, Governor Newsom has introduced other significant protections aimed at safeguarding children and preventing self-harm, regulating explicit deepfakes, mandating AI watermarking, preserving the digital likenesses of performers, and combating scams perpetrated by AI-generated robocalls. These measures build on the Governor’s March 2026 order that enhanced civil rights and privacy regulations related to AI technology procurement in California, while broadening the use of AI to enhance governmental services.
To address the potential impact of AI on the workforce, the new executive order requires state agencies to develop a comprehensive framework to ensure that workers are not marginalized as AI integration becomes more prevalent.
Key directives include:
- Empowering workers to benefit from AI advancements by promoting models of worker ownership that foster capital growth and enable wealth accumulation from increased productivity. The initiatives will provide educational and incentive resources for small businesses to effectively implement new technologies that bolster competitive growth and workforce development. Additionally, successful frameworks from collective bargaining will be examined to identify strategies yielding positive outcomes for workers, alongside enhanced training programs focused on AI within higher education.
- Monitoring and analyzing the effects of AI on the workforce will involve producing new reports that outline recommendations, best practices, and early warnings about potential labor disruptions, developed in collaboration with labor, industry, and academic experts. A new dashboard will also be established to visualize AI's impact across various sectors, and within 180 days, the California Worker Adjustment and Retraining Notification (WARN) Act will be evaluated to ensure timely responses to shifts in the job market. Business feedback on how technology influences workforce decisions will be incorporated into the state's monthly employment reports.
- Addressing potential job displacement will include a review of policies that provide safety nets for workers, such as severance packages and equity compensation. The state aims to boost awareness of employment insurance offerings, including stability payments, and create an AI playbook that modernizes job training frameworks. This includes enhanced strategies for reconnecting displaced workers with necessary training and assistance, as well as the development of a centralized online platform for Californians to access government services and discover eligibility for social programs. Furthermore, California Volunteers will collaborate with individuals facing long-term unemployment to facilitate essential training for entry-level positions.
- Strengthening public policy and support programs is crucial for leveraging AI to benefit society. The state will collaborate with academic experts and industry leaders to propose adjustments to incentive structures that encourage the design and deployment of AI solutions addressing critical societal challenges.
Moreover, Governor Newsom recently launched a groundbreaking statewide initiative in deliberative democracy, partnering with Engaged California to gather public input on AI's societal impacts. This initiative invites all Californians to participate and contribute to shaping state-level AI policies. Insights gained from this engagement will guide the initiatives outlined in the executive order. Residents can sign up for involvement at engaged.ca.gov/ai.
