CNBC's Deirdre Bosa joins 'Money Movers' to discuss how companies are rethinking AI coding as cracks in productivity are showing.

The release of Open AI's ChatGPT has accelerated the development of artificial intelligence and warnings about its impact on society.

Rise of AI

Recent research from AI nonprofit Meter indicates that experienced engineers using AI coding tools such as Cursor were 19 percent slower compared to working without them. The study found that AI-generated suggestions often required time-consuming corrections, challenging the prevailing belief that AI would significantly boost white-collar productivity. While junior engineers may see benefits from AI tools for simpler tasks, the need for senior engineers to review and finalize code remains high, contributing to ongoing demand for top talent. 

Additionally, data from enterprise software platform RAMP shows that paid AI tool usage has plateaued at around 40 percent, with some sectors even seeing a slight decline. Despite widespread adoption among tech giants, the anticipated productivity gains from AI coding tools appear more uneven and gradual than previously expected.

Cracks in AI productivity bull case

Tech giants like Microsoft and Google are outsourcing more and more coding to AI in a productivity push, but some new research shows the tools might not be as helpful as some expect. Our Drew Durbose is digging into that for today's Tech Check. Happy Friday, Dee. Happy Friday. Good morning, Carl. So this is some cold water poured on the AI productivity hype. Researchers at Meter, which is an AI nonprofit research firm, ran a real-world trial and found that seasoned engineers were actually 19 percent slower when using AI tools like Cursor. Instead of speeding them up, the AI often gave suggestions that looked helpful but actually required time-consuming corrections. Now, this undercuts a core Wall Street narrative that AI will supercharge white-collar efficiency and unlock a wave of productivity gains across the enterprise. Instead, the study suggests that the return on AI coding, it may be more uneven, less immediate than investors have priced it. Now, there is some nuance here. Prior studies from Meter have shown a more straightforward benefit to junior engineers from AI tools, particularly for simpler, well-scoped tasks. Now, this latest suggests that while it can help that group level up, it may actually be increasing reliance on senior talent because someone still needs to debug, refine and ship the final product. So that helps explain the current talent wars where Zuckerberg is throwing $100 million offers at top AI engineers. They're more essential than ever. Meanwhile, new data shows that AI adoption appears to be stalling more broadly. RAMP, this is a platform that tracks enterprise software spend. It shows that paid AI tool usage was flat at about 40 percent after a very steep run-up over the past year. Now, in the most aggressive sectors for adoption, tech and finance, there was actually a slight pullback. Now, I spoke yesterday to RAMP CEO Eric Gleiman, who told me that companies are trying these tools, they're not always working, and so they're asking eventually where's the value. At the same time, though, he says that the pullback comes after explosive adoption at the start of 2023. He says maybe one in 20 companies were using AI tools. Today, it's almost one out of two companies on RAMP that are spending on them. Now, when you look across the tech giants themselves, AI coding, it is already embedded. Google and Meta say that around 50 percent of their code is now written by AI. By the way, here, the tools, they're certainly being used. They're here. The payoff may just be more uneven than the hype suggests, and perhaps it plateaus at a certain point, justifying those huge paychecks for the most senior research AI analysts. What's really interesting, though, is, I mean, if you have these companies that go in and say, yeah, but our engineers are spending all of this time going back in and revising the suggestions from the AI tools, does that feedback make it back to the providers of the technology, and therefore, the kinks get worked? Maybe it's by AI, but the kinks get worked out, and that's the very feedback that helps them, maybe not this year, but next year, and the year after, improve that performance. That's a great point, right? The AI is also learning from these senior engineers that are debugging, that are refining the algorithm, so maybe it does get better. I think that's why you see this huge push for AGI, or super intelligence, the idea that eventually the models are smarter than even humans, so they can do 90 or even 100% of the coding. I think the takeaway here, too, is, though, that these tools are used at different levels. For junior engineers, they can be really useful. It's the engineers who go into a new job and are able to prompt. That levels them up, but at the very top, when you know the code source so well and you're a senior engineer, you're spending a lot of time rechecking. Maybe it's the middle that gets squeezed here. The point that we were making. Last hour, we were actually talking to Deirdre about whether the openness to change is different when you're a senior engineer than when you're a junior. Junior engineers may just be also more open to using those kinds of tools in their jobs. We'll watch it develop. That's dangerous, too, though, because the junior engineers may be accepting code that isn't 100% correct or creating more work later on for the senior engineers if that code hasn't been checked early on. Nobody ever thought of that. The point, though, is that it's not a straight line. Deirdre, thank you so much. Really fascinating tech check today.

An Israeli airstrike hit Palestinians near a medical center in Gaza on Thursday, killing 10 children and six adults, local health authorities said, as ceasefire talks dragged on with no immediate deal expected. This report contains graphic and disturbing images.

Jerusalem

Middle East Conflict

Israeli strike kills children near medical clinic in Gaza

Russian strikes against Ukraine persisted overnight and reportedly injured at least nine people and caused damage to a maternity hospital, according to officials. This comes as President Volodymyr Zelenskyy meets with European allies in Rome.

Kyiv

Ukraine Invasion

Russia launches more strikes, damages Ukraine maternity hospital

Israeli Prime Minister Benjamin Netanyahu is returning to Israel without a ceasefire deal with Hamas despite optimism from the Trump administration. CBS News' Elizabeth Palmer reports.

Tel Aviv-Yafo

Netanyahu returns to Israel without Gaza ceasefire deal

Immigration and Customs Enforcement (ICE) raids in California turned violent after protesters clashed with agents from the Trump administration carrying out an operation at a Camarillo farm.

Camarillo

Protesters clash with ICE agents over immigration operation

CNN’s Isa Soares explains how a crippling 50% tariff on goods from Brazil may not be all about the economy.

Washington

Global Tariffs

Trump targets Brazil with 50% tariff

Volunteers in Texas are searching for flood victims and combing through debris along a 30 mile stretch of the Guadalupe River. CNN’s Ed Lavandera spoke with Texans who are coming together to bring closure to their community.

Center Point

Urgent search operations for flood victims stretch miles in Texas

U.S. President Donald Trump said the United States would impose a 35% tariff on imports from Canada next month and planned to impose blanket tariffs of 15% or 20% on most other trade partners.

Trump puts 35% tariff on Canada, eyes 15%-20% levies for others

Volunteers in Comfort, Texas, are digging through debris with heavy equipment and cadaver dogs, searching for flood victims. U.S. President Donald Trump is set to visit Friday, raising questions about his plan to scale back federal disaster relief.

Texas

Volunteers dig through Texas flood wreckage ahead of Trump visit

Russian Foreign Minister Sergey Lavrov and US Secretary of State Marco Rubio have held rare face-to-face talks on the sidelines of an ASEAN meeting in Malaysia, discussing the war in Ukraine, as well as developments in Iran and Syria.

Kuala Lumpur

Top U.S., Russia diplomats discuss Ukraine on ASEAN sidelines

Russia has intensified its aerial attacks on Ukraine, using upgraded drones designed to cause more damage and evade air defences. In Kyiv, a young woman captured video of the drones overhead — just before explosions echoed through the city.

Russia’s upgraded drone tactics bring intensified attacks across Ukraine

The Ventura County Fire Department said they responded to calls of people having breathing problems at a farm in Ventura County, California, after federal agents appeared to deploy tear gas canisters into the crowd.

Ventura County

Intense standoff in California between protesters, federal agents

A federal judge has green-lit a class action lawsuit challenging President Trump's executive order to end birthright citizenship and issued a preliminary injunction blocking the order.

Judge blocks Trump's birthright citizenship order

A partial tunnel collapse in Los Angeles temporarily buried 31 workers in Los Angeles, California. CBS News' Carter Evans reports on the rescue operation.

Los Angeles

31 trapped workers rescued after tunnel collapse

U.S. Secretary of State Marco Rubio expressed “disappointment and frustration” over continued Russian attacks on Ukraine and said new sanctions on Russia are a “real option.” Kylie Atwood has more details from Kuala Lumpur, Malaysia.

Rubio: New Russia sanctions a ‘real option’

With Russia again bombarding Ukraine with drones, U.S. President Donald Trump says he’s considering sending another missile defence system to Ukraine.

Trump muses missile defence system for Ukraine

Officials in Texas are promising to address concerns about flood warnings in parts of the state, but say the ongoing search-and-rescue efforts must be complete first.

Texas officials to address flood warnings after search complete

Linda Yaccarino is stepping down as CEO of X after two years leading Elon Musk's social media company. Yaccarino's departure comes one day after the company's Grok chatbot began pushing antisemitic tropes in responses to users.

San Francisco

Yaccarino steps down as CEO of Elon Musk's X

Parts of Ukraine were on fire overnight after Russia launched its largest drone attack on Ukraine since the war unfolded. Just hours earlier, Trump directly called out Vladimir Putin for stalled peace talks.

Moscow

Trump calls out Putin for stalled peace talks

The Trump administration branded the event as one of the steps it is taking to reshape its relationship with the African continent.

Five African leaders have lunch with Trump

The search continues in central Texas for the more than 160 people still missing from the deadly floods that hit over the Fourth of July. CBS News reporter Karen Hua has more.

Kerr County

Recovery operations ongoing in Texas as more than 160 still missing

U.S. President Donald Trump announced on social media that he issued tariff letters to Algeria, Brunei, Iraq, Libya, Moldova and the Philippines.

Trump sends tariff letters to six more countries

Video released by the Houthi media center shows the bulk carrier ‘Magic Seas’ being attacked and later sinking in the Iran-backed rebel group’s first attack this year on a commercial shipping vessel in the Red Sea.

Sana'a

Houthi rebels claim responsibility for attack on ship in Red Sea

The European Court of Human Rights in Strasbourg ruled Russia violated international law in Ukraine and was responsible for the downing of Malaysia Airlines Flight MH17.

Top European court rules Russia violated international law in Ukraine

The death toll from the July Fourth flash flood that ravaged a swath of central Texas Hill Country rose on Tuesday to at least 109, many of them children, as search teams pressed on through mounds of mud-encrusted debris looking for scores of people still missing.

Texas flood death toll hits triple digits, tally of missing tops 180

U.S. President Donald Trump pushed back during his Cabinet meeting about a question regarding Jeffrey Epstein. The DOJ claims Epstein had no list of clients, which is drawing criticism from some of the president's supporters.

Trump questioned over report saying Epstein didn't have client list

The copper industry is facing new uncertainty after U.S. President Donald Trump said he will impose 50 per cent tariffs on all copper imports. More than half of all Canadian copper exports go to the U.S.

Ontario

Trump threatens 50% tariff on copper imports

CNN’s Josh Cambell reports on questions over a lack of flood warning signals and lagging investment in river gauges in Kerr County after deadly floods killed over 100 people in Central Texas.

Officials face questions over preparedness for Texas floods

Hundreds of firefighters battled a fast-moving wildfire that reached the outskirts of the southern French city of Marseille on Tuesday, forcing people to stay indoors and the nearby airport to close.

Marseille

France wildfire shuts down Marseille airport

Liverpool's Portuguese forward Diogo Jota was probably speeding when the Lamborghini car he was driving crashed in northwestern Spain, killing him and his brother, police said in a preliminary report.

Cernadilla

Liverpool's Jota likely speeding when car crashed, police say

French President Emmanuel Macron arrived in Britain on Tuesday for a state visit mixing royal pageantry with thorny political talks about stopping migrants from crossing the English Channel in small boats.

Cracks in AI productivity bull case

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Rise of AI