November 19, 2025: New Pillar of Growth

 

Businesses are increasingly turning to AI as a domestic solution for cost control and productivity gains. The recent spike in layoff announcements illustrates the pressure on businesses to curb costs, and it seems like businesses plan to increase AI adoption rates as they decrease headcount. 

Here is what we know:

  • Roughly 20% of October layoffs were attributed to AI alone.
  • Overall, cost-cutting drove 33% of all layoff announcements. Interestingly, businesses are not reporting weaker economic conditions or slower sales as major reasons to announce layoffs.
  • Many firms are still in the early stages of experimentation, constrained by legacy systems, workforce readiness, and integration costs.
  • As AI tools become more accessible and regulatory frameworks clearer, we expect broader deployment in the economy, unlocking productivity gains and cutting labor costs. 

 

The financial markets are being influenced by a mix of factors this week, including the following:

  • Job market weakness: A weak job market is a key driver of the recent market downturn, particularly affecting AI stocks.
  • Debt-fueled investment: A significant portion of this investment is being funded by debt, which is a source of concern for investors.
  • Impact on supply chain companies: The financial health of companies that supply equipment to data center builders is also a point of worry. 

 

For the week of November 17th, the US economic calendar features several key reports:

  • Monday - Construction Spending
  • Tuesday - Manufactured Goods
  • Wednesday - Minutes from the October Federal Open Market Committee (FOMC) meeting, NVIDIA earnings report
  • Thursday – Initial Jobless Claims
  • Friday - Surveys of Consumers and Real Earnings for September 2025