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May ADP Report and More ?3

09:16 03-Jun-26

This morning's ADP report for shows +122K jobs in May and pay increasing 4.4% YoY.  The former number beats projections around +110K.  Job gains were broad based geographically, but dominated by Health & Education and Trade/transportation/utilities.  Information and Mining were the only industries to lose jobs at -9K and -3K.  All this is in line with this service's forecast that the labor market will gradually shift toward hands on work with lower value pay; of industries mentioned, only Trade/transportation/utilities managed to match the overall average for pay gains.

The market may be more concerned with Warsh signaling change at the Fed.  This service sees increased likelihood for missteps in policy and communication, though probably not in his first press conference on the 17th.  A watered down executive order seeking advanced government access to AI models is also getting attention.  Normally this might push development outside America, but as our parent CrowdWisers service documented yesterday in a report title "Nvidia AI PCs and the successor to Moore's Law", companies seem likely to stay where the investment capital is, for now:

To put a cap on the FLNC commentary, some pundits are attributing the move to this collaboration on data center reference designs from Siemens and Nvidia.  This would only have fundamental impact on Fluence if we hadn't already accounted for the company's backlog in the last report.  Furthermore, as the Q&A in that report alluded, the Fluence advantage is primarily in the American market, while tariffs last, and a fading first mover advantage for the rest of the globe.  That doesn't go well with America already handily outspending the rest of the globe in terms of compute infrastructure, but China playing the long game by leading in battery development, electric generation and automated manufacturing.  Seimens was certainly aware of this reference design with Nvidia before it filed cash out all of its FLNC shares.  So as things stand, I see this as just once more attempt to maximize its short term payout.

On 6/1/26 9:30 AM, Esekla wrote:

In a somewhat related development on the decline of x86, Linux anticipates removing the x32 ABI from kernels and DNS-AID is being developed to allow online AI discovery using MCP over DNS.  This service has applied a legacy label to that ecosystem and tracked its status against ARM and RISC over the past 5 years, noting that Intel had no credible path to marketing AI PCs without Nvidia.  On the global stage, China's Huawei has even proposed the Tau Scaling Law measuring data transit through a system as a successor to Moore's Law.  I note that this does little to offset the country's domestic manufacturing gap, but I'd always considered Intel's devotion to the plan foolish.  Still, Taiwan and Himax should be ever more worried, though the latter is offset by a little by a win in e-ink driver chips.

That said, its not all good news for AI, as Ohio is suspending its data center tax break, and there are other signs of pushback from developers as well as consumers.  DuckDuckGo has stated that traffic to its NoAI search page have tripled, and installs of the service have risen by 30% since Google redesigned its own search page to feature Gemini.

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