Brad Conger doesn’t think so. As the chief investment officer of Hirtle Callaghan asserts to my colleague Shawn Tully,  “AI’s not replacing jobs, but job cuts are funding AI expenditures.” Conger has a point. With Gartner anticipating global capital spending on AI to hit $2.5 trillion this year, that money has to come from somewhere.

With the U.S. at war, a volatile stock market and increased fears of a 1970s-style stagflation—not to mention leaders like Block CEO Jack Dorsey already citing AI as a reason to slash headcount—it’s worth pausing to contemplate what’s really behind the job cuts. Nailing down the root cause will shape the perceptions and policies around unemployment, and the ability of leaders to do something about it. A few points that I think about:

There are troubling trends. Some were skeptical about the job numbers before the latest drop. The current unemployment rate, now at 4.4%, doesn’t include those who have given up looking for work or are stuck in low-paid jobs that don’t match their skills and aspirations. Even that broader measure, which was 7.9% in February, doesn’t capture sluggish wage growth, eroding optimism, rising costs, and other forces that have long shaped the employment picture. Few understand that complexity like the beleaguered economists at the Bureau of Labor Statistics, who’ve been consistently revising numbers downward of late.

AI leaders can’t predict AI’s impact. ​​Anthropic just put out a chart that claims to quantify AI’s impact on jobs in different professions. But let’s remember that the titans of tech often have a hard time time predicting the future, or recognizing excellence in a form that doesn’t remind them of themselves. It’s why Elon Musk and Mark Zuckerberg can’t see the value of great managers. Humans can be fallible, as are the algorithms they create.  

Some truths are timeless. When consumers fuel 70% of your economy, you need people with money to spend. That’s why Henry Ford doubled his workers’ wages. Certainly cost-cutting can buy you time, and AI may be able to scale and amplify your talent. But a sluggish economy with rising prices, volatile stocks and CEOs feeling pressure to cut costs isn’t a good recipe, regardless of the technology that’s coming down the pipe.

Contact CEO Daily via Diane Brady at diane.brady@fortune.com

Top leadership news

Anthropic sues U.S. government

Anthropic sued a number of federal agencies including the Department of Defense on Monday, accusing the Trump administration of “unprecedented and unlawful” actions after the government canceled its contracts with the AI company and labeled it a supply-chain risk. Anthropic had refused to remove restrictions on the government using its technology for domestic mass surveillance and autonomous weapons.

Testing Larry Ellison’s 3-step transformation

Oracle’s latest quarterly results, out today, will test whether Wall Street buys Larry Ellison’s pricey AI bet. Investors are fretting over $108 billion in debt, billions in capex, and negative free cash flow. With shares down 20% this year, layoffs and leverage are shaping the company narrative.

Blankfein on DEI

Former Goldman Sachs CEO Lloyd Blankfein criticized Wall Street’s DEI orthodoxy in a recent interview, arguing that Goldman’s minority-focused programs were “counterproductive.” “If you brand something a remedial program, you’re kind of also branding the people who go into that program,” he said. Goldman Sachs has rolled back its DEI initiatives this year.

The markets

S&P 500 futures are up 0.44% this morning. The last session closed up 0.83%. The STOXX Europe 600 was up 2.02% in early trading. The U.K.’s FTSE 100 was up 1.56% in early trading. Japan’s Nikkei 225 was up 2.88%. China’s CSI 300 was up 1.28%. Hong Kong’s Hang Seng was up 2.17%. South Korea’s KOSPI was up 5.35%. India’s NIFTY 50 was up 0.82%. Bitcoin was down to $71K.

Around the watercooler

CEOs are using one number in the AI age to decide how many people they still need by Nick Lichtenberg 

Health care has been propping up a shaky labor market. For the first time in over four years, the sector shed thousands of jobs by Sasha Rogelberg

The ‘Singapore-washing’ strategy starts to unwind as both China and the U.S. closely scrutinize corporate roots by Angelica Ang

Odds of a stock market meltdown with 1970s-style stagflation jump to 35% this year, veteran strategist warns by Jason Ma

CEO Daily is compiled and edited by Joey Abrams, Claire Zillman and Lee Clifford.