Bosses like to tout shrinking head counts as AI accomplishments.
If you are reducing headcount, and can attribute it to AI, then brag about it.
The Wall Street Journal reports CEOs Trumpet Smaller Workforces as a Sign of Corporate Health
Big companies are getting smaller—and their CEOs want everyone to know it.
The careful, coded corporate language executives once used in describing staff cuts is giving way to blunt boasts about ever-shrinking workforces. Gone are the days when trimming head count signaled retrenchment or trouble. Bosses are showing off to Wall Street that they are embracing artificial intelligence and serious about becoming lean.
After all, it is no easy feat to cut head count for 20 consecutive quarters, an accomplishment Wells Fargo’s chief executive officer touted this month. The bank is using attrition “as our friend,” Charlie Scharf said on the bank’s quarterly earnings call as he told investors that its head count had fallen every quarter over the past five years—by a total of 23% over the period.
Now there is almost a “moral neutrality” to head-count reductions, said Zack Mukewa, head of capital markets and strategic advisory at the communications firm Sloane & Co.
Bank of America CEO Brian Moynihan reminded investors this month that the company’s head count had fallen significantly under his tenure. He became chief executive in 2010, and the bank has steadily rolled out more technology throughout its functions.
“Over the last 15 years or so, we went from 300,000 people to 212,000 people,” Moynihan said, adding, “We just got to keep working that down.” Overall, Bank of America’s staff size has fallen by 1,500 people since the beginning of the year, excluding summer interns.
Some leaders acknowledge the human cost of such layoffs. Microsoft announced this month plans to cut another 9,000 workers, bringing its job cuts to 15,000 in the past two months. In a memo to staff on Thursday, Microsoft CEO Satya Nadella said the layoffs had weighed on him as the company reorients its business to AI.
Does Anyone Seriously Believe BLS Job Reports?
On June 16, I commented QCEW Report Shows Overstatement of Jobs by the BLS is Increasing
The discrepancy between QCEW and the BLS jobs report is rising.
QCEW consists of 12.2 million establishments with about 95 percent coverage.
The Nonfarm payroll report surveys ~629,000 establishments with a response rate of 42.6 percent as of March 2025.
Large establishments likely have someone responsible for handling government surveys.
Small businesses, especially struggling businesses, may not take the time to respond to surveys.
To make up for its small sample size, the CES report uses a Birth-Death model to estimate the numbers of employees at new businesses vs businesses going out of business. At turns, these estimates may be seriously wrong.
Questions of the Day
Given the New York Fed, the Philadelphia Fed, ADP, and the BLS know how to seasonally adjust data
- Why don’t they?
- Why can’t we have the QCEW monthly instead of quarterly, even if it’s preliminary?
It’s clear to everyone that the monthly jobs report is totally screwed up and that Covid distortions and Birth-Death nonsense are still in play.
Mish Suggestion
Rather than tweak a broken model, I suggest starting all over with preliminary MCEW (monthly) reports instead of QCEW (quarterly) reports.
Note that even the first two months of CES are considered preliminary, and they are based on tiny samples with low response rates, massaged by a broken Birth-Death model.
How could my proposed MCEW be worse than that?
Related Posts
June 6, 2025: Nonfarm Payrolls Rise by 139,000 Employment Declines by 696,000
Can anyone believe these reports anymore?
July 3, 2025: Jobs Beat Expectations, Up 147,000 in June, but Government Jobs Rise 73,000
Government to the rescue?
July 2, 2025: ADP Reports 33,000 Job Losses in June with Negative Revisions in May
Small and medium-sized businesses shed jobs in June.
July 19, 2024: Only Three of 12 Fed Regions Are Growing, Two Slightly
The Fed’s Beige Book shows a weakening economy
On Friday, the BLS reports nonfarm payrolls. The report may be amusing.
This post originated on MishTalk.Com
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Mish
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