Xbox's CEO Just Laid Off 3,200 Workers. Now She's Advising the Fed on "Jobs and Productivity."

The Federal Reserve wants outside help figuring out what AI is doing to the American workforce. One of the people it just picked to provide that help is an executive who, days earlier, cut roughly 3,200 jobs from her own division.

Xbox CEO Asha Sharma has been named to a new Fed task force focused on "jobs and productivity," part of a broader slate of advisory groups the central bank announced to bring private-sector perspective into its policymaking. The timing is hard to miss: Sharma's appointment became public just after she informed Microsoft's gaming staff that layoffs would roll out across the division over the next 12 months.

Fed Chairman Kevin Warsh unveiled the task forces in a press release on July 9, framing them as an effort to modernize how the central bank thinks about a changing economy. "The Federal Reserve's commitment to price stability and maximum employment is unwavering. As is our resolve to pursue our mandate with rigor," Warsh said. He added that the U.S. economy "has changed significantly over the last generation, and never more so than right now," and said he wanted "the best minds from a range of disciplines" helping the Fed sharpen its approach.

Sharma's specific group has been tasked with assessing "the economic impact of new general-purpose technologies, including artificial intelligence," to help shape the Fed's policy thinking. She won't be doing that alone. Her fellow task force members include Charles I. Jones, a Stanford economist who also works with the AI company Anthropic, and venture capitalist Marc Andreessen of Andreessen Horowitz.

A resume built for this moment, on paper

Sharma's path to this seat tracks a familiar Silicon Valley arc. Before Microsoft, she worked at Instacart and Meta. Once inside Microsoft, she joined the company's Core AI group before being moved over to lead Xbox earlier this year, tasked with turning around a gaming division that's been struggling to find its footing.

Her tenure so far has been defined by speed and by cuts. The layoffs she announced this month hit deep into the organization, including senior staff who'd spent decades at Xbox and its game studios. In a memo to staff explaining the cuts, Sharma described a company weighed down by its own bureaucracy.

"We know that great technology gets better when it gets simpler, not bigger," she wrote. "Today, in some parts of the company, work passes through as many as 14 layers of management. Our platform teams are 40% larger than they were at the start of this generation, even as our player base and playtime have declined. That complexity has slowed decisions, blurred accountability, and made it harder to deliver for players. As we reset XBOX, we will simplify."

That's the logic of an internal restructuring memo. It reads very differently once you know its author is now, in the same week, taking a seat at the table where the Fed decides how AI-driven disruption to employment should factor into national economic policy.

The company she's keeping

The composition of the task force has drawn its own attention, particularly the inclusion of Andreessen, the venture capitalist and Netscape co-founder who's built a fortune off of Silicon Valley's boom-and-bust cycles and become one of the loudest public voices cheerleading AI's disruptive potential. He's known as much these days for his podcast appearances and provocations as for his early browser work.

Putting Andreessen, an AI-aligned economist connected to Anthropic, and an Xbox CEO who just executed a major AI-adjacent restructuring on the same panel signals where the Fed's thinking may be headed: toward voices deeply invested in AI's expansion, evaluating AI's impact on the very jobs their own industries are eliminating.

The Fed's task forces are billed as advisory, not decision-making bodies. But advisory input from people actively shaping the labor market they're being asked to analyze carries obvious weight. Sharma isn't studying layoffs from a distance. She's ordering them, then heading to Washington to help explain what they mean for the rest of the country.

What happens next at Xbox will be the real test of her "simpler, not bigger" thesis. What she tells the Fed about jobs and productivity, and how much her own decisions this month inform that advice, is worth watching just as closely.