Booming corporate earnings and a slumping labor market have been telling very different stories lately, and AI is the likely explanation, according to Chen Zhao , chief global strategist at Alpine Macro .

That dichotomy is exemplified in the tech sector, which has seen profits soar while employment has been in a “recession” for three years, he said in a Monday note titled “A Jobless Profit Boom.”

“We suspect that job losses in tech have been driven mainly by AI displacement,” Zhao added, pointing to recent cuts at Amazon , Meta and Salesforce . “These layoffs, however, are happening amid exceptionally strong profit growth in these companies—a significant departure from the past, when job cuts typically followed declining profitability.”

This jobless profit boom isn’t limited t

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