Traders work on the floor at the New York Stock Exchange (NYSE) in New York City, U.S., Sept. 8, 2025. <\/p>\n
Jeenah Moon | Reuters<\/p>\n
Here are two statements that, on the surface, may appear contradictory:<\/p>\n
The U.S. labor market is weakening, with the number of jobs in June actually decreasing<\/a>.The U.S. stock market is hitting all-time highs, with the Nasdaq Composite<\/a> being the latest index to do so<\/a> on Monday.<\/p>\n Why do those premises sit together uneasily?<\/p>\n Well, a slowdown in jobs growth implies a faltering economy, which has generally been bad for stocks. When people lose their jobs \u2014 or simply feel like they can’t afford to buy goods and services \u2014 corporate revenue falls. And those numbers are what, fundamentally, stock prices are based on.<\/p>\n But major indexes closed higher Monday, despite news of a weaker-than-expected jobs market in August. Of course, the prospect of rate cuts boosted investor sentiment.<\/p>\n A closer look at the individual movements of stocks, however, might provide another explanation for that. Technology firms \u2014 and artificial intelligence companies such as Broadcom<\/a> and Nvidia<\/a>, in particular \u2014 led the rise.<\/p>\n Investors, then, might have also shrugged off the August jobs report because they could be aware that the advent of AI will bring with it not just job losses<\/a>, but also the end of the career ladder<\/a>. Salesforce last week revealed it had cut 4,000 jobs because of AI<\/a>, while Klarna in May said AI helped the company shrink its workforce by about 40%<\/a>.<\/p>\n So, the implication \u2014 but a highly speculative and far-fetched one! \u2014 is that job losses could, in some ways, indicate that AI is working as intended \u2014 good for the companies, not so much for job seekers.<\/p>\n What you need to know todayAnd finally…<\/p>\n People walk by the New York Stock Exchange on April 4, 2025.<\/p>\n Spencer Platt | Getty Images<\/p>\n