Congressional leaders from both parties united today to pass groundbreaking legislation requiring employers to report AI's role in workforce decisions, marking the most significant federal response to automation displacement fears since the rise of generative AI.
The bipartisan AI Jobs Reporting Act, led by Senator Jim Banks (R-IN) alongside Democratic colleagues, establishes unprecedented transparency requirements for companies using artificial intelligence in layoff decisions while creating a dedicated research infrastructure to track automation's economic impact.
Bipartisan AI Workforce Research Hub Established
The legislation creates an AI Workforce Research Hub within the Department of Labor, tasked with developing comprehensive forecasting models to predict automation's labor market impact. The hub will coordinate with private sector partners to create "prize competitions" for developing better AI workforce measurement tools.
"We have to understand how AI is changing the workforce before we can effectively respond to it. This bill gives us the data-driven foundation we need."
Companies will be required to report when AI "was a substantial factor" in mass layoff decisions, providing federal agencies with unprecedented visibility into automation-driven job displacement. The reporting requirements apply to companies with over 500 employees conducting layoffs affecting 50 or more workers.
$250 Million Democratic Worker Protection Package
A companion bill from Democratic leaders Senators Mazie Hirono (HI) and Adam Schiff (CA), alongside Representative Lisa Blunt Rochester (DE), allocates substantial federal resources for workforce transition support:
- $160 million for technology teacher development programs in K-12 schools
- $90 million in direct support for workers displaced by AI automation
- Coordination requirements between Labor, Education, and Commerce departments
- Grant funding for community colleges developing AI-adjacent training programs
"American workers cannot be left behind as we advance in the digital economy. We must ensure advances enabled by AI are used to strengthen, not weaken, the workforce."
Corporate America Faces New Transparency Requirements
The reporting mandate comes as major corporations increasingly cite AI and automation in earnings calls discussing workforce reductions. Goldman Sachs analysis found nearly half of recent corporate earnings calls mentioned upcoming layoffs linked to AI implementation.
Technology companies, in particular, face scrutiny as they simultaneously invest heavily in AI capabilities while reducing headcount. The legislation requires detailed disclosure of:
- Specific AI technologies deployed in workforce decisions
- Timeline between AI implementation and job reductions
- Alternative worker transition options considered
- Projected productivity gains from automation
Industry Response Mixed
Business groups expressed concerns about regulatory burden while labor advocates praised the transparency requirements. The U.S. Chamber of Commerce called for "balanced implementation" that doesn't discourage AI innovation, while the AFL-CIO endorsed the measures as "essential worker protections."
Automation Displacement Projections Drive Urgency
Congressional action comes as AI capabilities rapidly advance beyond current deployment. Recent projections from leading AI companies and research institutions paint an accelerating automation timeline:
- Anthropic CEO warned AI could eliminate half of entry-level white-collar positions
- Goldman Sachs economists estimate 6-7% total workforce displacement potential
- McKinsey research suggests 375 million workers globally may need retraining by 2030
- World Economic Forum predicts 85 million job displacements by 2025
"We're not trying to stop AI development, but we need to understand its workforce impact in real-time rather than after the fact. The American people deserve transparency about decisions affecting their livelihoods."
Implementation Timeline and Next Steps
The AI Jobs Reporting Act takes effect January 1, 2026, giving companies six months to develop compliance systems. The Department of Labor must publish initial reporting requirements within 90 days, with the first quarterly reports due April 2026.
The companion workforce support bill requires agency coordination plans within 60 days and initial grant distributions beginning March 2026. Congressional committees will conduct oversight hearings quarterly to assess program effectiveness.
This landmark legislation represents the first comprehensive federal response to AI-driven workforce disruption, establishing the regulatory framework for transparency and worker protection as automation acceleration continues reshaping American employment.