California Gov. Gavin Newsom (D-CA) issued an executive order Thursday to prepare the state for mass unemployment caused by artificial intelligence [1].

The move marks the first time a U.S. state has used an executive mandate to address the systemic labor risks posed by AI. As companies pivot toward automation, the state aims to prevent a crisis where wealth concentrates within a few dominant corporations, while the general workforce loses its primary source of income.

The order follows reports that Meta fired approximately 8,000 people [2] as the company increased its investments in AI. This specific wave of layoffs serves as a catalyst for the state government's intervention in San Francisco, where the administration is now evaluating how to sustain citizens in an era of rapid technological displacement.

Central to the state's strategy is the consideration of Universal Basic Capital, or UBC [1]. Unlike traditional basic income, which provides a recurring cash payment, UBC is designed to give citizens a stake in the capital generated by AI systems. The goal is to ensure that the economic gains from automation are distributed more broadly across the population, rather than remaining solely with shareholders.

Newsom said the state must act now to create a safety net before AI-driven job losses reach a critical mass. The executive order directs state agencies to analyze the potential for large-scale workforce disruption and develop frameworks for the UBC model.

While the specific funding mechanisms for UBC remain under review, the administration is prioritizing the creation of a sustainable economic model that decouples survival from traditional employment. This approach seeks to mitigate the risk of severe economic inequality as AI continues to replace human labor in high-growth sectors [1], [2].

“California Gov. Gavin Newsom (D-CA) issued an executive order Thursday to prepare the state for mass unemployment caused by artificial intelligence.”

The shift from Universal Basic Income to Universal Basic Capital suggests a strategic pivot toward wealth redistribution rather than just poverty alleviation. By attempting to give citizens an ownership stake in AI productivity, California is experimenting with a new social contract to prevent a permanent underclass as automation renders certain professional roles obsolete.