How AI Could Keep Young Workers From Getting the Skills They Need

Whenever people talk about the dangers AI holds for the workforce, they usually have one thing in mind: technology stealing jobs. But artificial intelligence poses a much more subtle threat than that—one that will have consequences for business unless we address it.

Simply put, the way we’re handling AI is keeping young workers from learning skills.

For more than 12 years, I have been studying how work changes as a result of intelligent technologies like robots and AI. Across a number of industries, I’ve seen the same thing over and over: This new, sophisticated technology makes it easier for experts to do their jobs. Seasoned surgeons can operate more quickly and efficiently, for instance, when they use robots in the operating room.

But the efficiency comes at a cost. The technology allows experts to do more, independently, so they don’t need younger, less-experienced workers to help them out anymore—so those novices are left without mentors to teach them the skills they need to do their job. Looking at operating rooms again, it takes two people to perform most complex procedures with traditional tools. The senior surgeon generally provides “exposure” by retracting tissue while the resident does what most of us think of as surgery—incisions, suturing and so on. Residents are on task the entire time. Focused. Learning.

Now the residents mostly sit around during operations and watch veteran surgeons get the job done thanks to help from a robot. Limited work. Limited learning.

As learning opportunities like these are lost throughout more industries, the results could be profound for both individual workers and the economy. We are sacrificing skill building and human bonds of mentoring on the altar of productivity. No matter our role, tenure, occupation or industry, if we can’t collaborate with someone who knows more, we’re not going to learn effectively, and we won’t be able to keep up. And our organizations will struggle where they might otherwise race ahead—because workers won’t have the deep knowledge they need to innovate and step into senior roles.

Turning history on its head

We have decades of research showing that this situation is the opposite of what we want. We build skill by collaborating across the expert/novice divide, so novices get to see the work, help out at the edges and earn the privilege of doing more next time.

Now that mechanism is being lost. My observations, combined with primary data from other field researchers, show a destructive dynamic at work, across a range of industries. In industrial-process engineering, I have seen experts use software to do modeling on their own, instead of involving a junior engineer. In warehousing, I’ve watched area managers rely on dashboard analytics to understand staffing and process flows, instead of uncovering those things collaboratively with less-experienced line leads and workers.

My collaborator Callen Anthony at New York University found that junior investment-banking analysts were being separated from senior partners as those partners started to use algorithms to help create company valuations for mergers and acquisitions. Junior analysts—instead of collaborating with the senior partners as they had before—essentially just pulled data for the algorithms to use in their valuations.

The rationale for this arrangement was twofold: reduce errors by junior people in sophisticated work and maximise senior partners’ efficiency. Explaining the work to junior staffers pulled partners away from higher-level analysis.

This setup produced short-run productivity improvement, but it moved junior analysts away from challenging, complex work, making it harder for them to learn the entire valuation process and diminishing the firm’s future capability. Junior bankers become senior bankers, after all.

Less time at the table

One of the most striking examples of the widening skill gap is surgery. I observed hundreds of procedures at some of the top teaching hospitals in the country, where robots deeply reshaped how work was done. Surgery, as I said, used to take four hands; minimally invasive surgical robots can supply three, all controllable from a single console. They make things so much easier for surgeons that the million-dollar tools have become the de facto standard for many complex procedures.

Most important, robots make it possible for surgeons to perform operations solo, no residents needed. And, since residents are slower and make more mistakes than an experienced surgeon would, those surgeons are opting to cut residents out of the action. Before, residents might operate for four hours during a 4½-hour procedure. In my nationwide data, their robotic average time hovered in the 10- to 15-minute range. And residents got less operating time in 88% to 92% of cases.

In this situation, we end up with much-less-capable surgeons. My data shows that many newly minted surgeons struggle mightily when they get their first jobs—not just because they don’t have robotic skill, but because their failed quest to learn robotics took so much effort they lost key learning opportunities in other procedures and practice areas, from ureteroscopy to kidney stones to vasectomies, that they would be expected to handle in most new surgical jobs.

The long-term loss

The consequences of poor training go beyond day-to-day competence. Consider what happens to the culture of a hospital when it loses healthy expert/novice collaborations. Less teaching and learning, to be sure, but also more-limited career advancement as experts advocate less for trainees. What about hospitals’ ability to innovate in surgical practices? Limits there, too, as discoveries made by colleagues get tamped down by increasingly focused, efficient, expert-driven surgical performance. The ability to service skyrocketing surgical demand? In the short run, you serve more patients, but in the medium term you scramble to keep up as the pool of new talent dwindles.

Of course, different organisations, industries and professions in different places will feel the pinch on different time scales. They will also compensate in different ways. But in general, organisations will not sense the problem directly: Instead, they will incrementally accumulate a larger cost base—in areas such as (re)training and reduced billable or applied time—and build a bureaucracy to manage this skills gap. At law firms, new attorneys might take longer to ramp up to normal caseloads, while senior attorneys would have to spend more non billable time to handhold them.

Now imagine the consequences of similar skills gap across all types of companies, throughout the economy. Without a firm, immediate correction, this is what we can expect. This is our trillion-dollar skills problem.

A way forward?

Solving the problem is vital, but how should we do it? My collaborator and I found evidence of one approach that can work.

Remember, the problem right now is that senior workers are learning new technologies, such as robotic surgery, that make junior workers unnecessary. In our research, though, we found cases where junior and senior workers teamed up to learn about new technologies together .

By working closely with seniors in this way, the juniors didn’t just learn about the new technologies, they ended up collaborating with seniors on other aspects of the job. Since the older and younger workers were figuring out how the tech worked, they also needed to figure out how to integrate it into vital day-to-day tasks. So, the novices got to see firsthand how those jobs were done while performing actual work.

For instance, in my research, I saw some residents and senior urologists team up to learn robotic techniques in live surgical procedures. In those cases, the residents got much more actual hands-on operating time than residents who mostly just watched robotic procedures—10 times more. And the quality of that time was far better: Expert and novice were jointly figuring out how to use the tech, just as they had a patient on the table.

Granted, this process isn’t easy. In our research, we found that these collaborations often failed. But when they did work, they were powerfully effective. We need more companies to take the chance and implement this strategy, to figure out how to make it most effective and serve as examples.

It will not only help close the skills gap, it will give old and new workers a new sense of purpose on the job—through strengthened relationships. Research shows very clearly that we get motivation for our work when it builds trust and respect with those who share our values. Progressing to more competence therefore involves questions of the heart, like, “Have I earned this expert’s trust and respect?” or “Does this novice look up to me?”

We often treat these issues as unconnected with hard-nosed skill and results, when they are a core part of why we try at all in the first place. They are the animating force for the journey.

Matthew Beane is an assistant professor at the University of California, Santa Barbara, and author of   The Skill Code: How to Save Human Ability in an Age of Intelligent Machines.”

Can You ‘Unboss’ Yourself Without Ruining Your Career?

Sick of managing people? Maybe you should stop.

So many of us stumble into being the boss, or raise our hands because it feels like the only way to get ahead . We’re attracted to the cachet of the title, the promise of more money or the comfort of having a ladder to ascend.

Then come the performance reviews to write, the team drama to adjudicate, the meetings to attend . The job keeps getting harder. Managers oversee nearly three times as many people today as they did in 2017, according to data from research and advisory firm Gartner . Nearly one in five managers says that, given a choice, they’d prefer not to oversee people.

“That’s what we call buyer’s remorse,” says Swagatam Basu , a senior director in Gartner’s human-resources practice.

You can switch back. And your company might be amenable. More are “unbossing” their workplaces by shrinking middle-management layers .

The trick is figuring out a way to maintain your pay and influence. In some companies, the number of people you manage is a proxy for your power. Others now use special individual-contributor tracks, meant to ensure that technical experts have a set path to climb.

You might have to give something up. Making the shift could still feel like a relief.

“It was like, oh, I don’t have to deal with the people issues,” says Suzet McKinney , an executive at Sterling Bay, a Chicago real-estate company. She’d served in leadership positions before. When she started her current role in 2021—no pay cut required—she figured she’d eventually hire direct reports and build out a team. Then she realized she didn’t miss it.

“Managing people would be more of a distraction,” she says.

Making the ask

Dennis Henry , an engineering director overseeing about 45 staffers, was hungry to move to the next managerial rung at software company Okta last year. Then his supervisor explained that would mean even less time to do the technical work he loved. It made the 38-year-old wonder: Did he want to be a boss at all?

“What would hurt more?” Henry asked himself. Giving up managing or giving up coding? The latter felt unfathomable.

He pondered what he’d want if he left management entirely and became an individual contributor, ranking priorities. Maintaining his base salary—just shy of $300,000—was tops. He told his boss that he was happy to stay in his current role if a new opportunity didn’t pan out.

“You have to be ready to hear ‘no,’ ” the Orlando, Fla., resident says.

He got a yes: The company created a new job for him and preserved his pay. After 15 years as a manager, carving out a new kind of authority has been a transition.

As a boss, “I could just say, ‘Do this,’ ” he says. Now he spends more time amassing evidence for his ideas, making his case.

“It is so much harder to convince people that something is the best option,” he says.

The stress of managing

Jenny Blake ’s mental health took a dive after she was promoted to team lead at Google at age 24. She felt stressed and emotionally drained, deeply responsible for her team but beholden to decisions from above, like a department reorganisation ordered up by executives.

A 2024 survey from SHRM, a lobby for human-resources professionals, found that 40% of respondents said their mental health declined when they took on a managerial or leadership role.

Blake switched to an individual contributor job, spending several years rolling out new programs she felt had a much bigger impact than her management. Now an author and speaker focused on careers and business, she recommends broaching the transition conversation by laying out your unique strengths and how they can better serve the company in a new role. Don’t dwell on your distaste for managing people.

Want to ensure the shift isn’t a demotion? Make sure you’re staying close to parts of the business that are directly tied to revenue, she says. Build your reputation externally, speaking at conferences and publishing papers.

“Become an industry expert,” she says.

The reality of switching

Just because a company touts opportunities for individual contributors to grow doesn’t mean you’ll be able to rise to the top unimpeded. A former consultant at a professional-services firm told me that partners who didn’t have their own teams were treated like second-class citizens.

At Launch Potato, a digital-media company based in Delray Beach, Fla., the individual-contributor track tops out several levels below the executive level. Even on the lower rungs, managers have the opportunity to make higher salaries and bonuses than commensurate individual contributors, says Kristopher Osborne , the company’s senior vice president of talent.

“You are getting paid a premium to deal with a lot more issues and challenges,” he says of managers. “People have to be realistic.”

He recommends ambitious individual contributors show they’re bringing leadership to the company in different ways. Can you run strategy initiatives, coach teammates or get swaths of the organization on board with new initiatives?

Letting go

In a previous job, Sheri Byrne-Haber liked managing people and being a “one-stop shop” for her 20-person digital-accessibility department, even as the workload ballooned. So when her boss suggested splitting her role in two, she initially said no.

She reconsidered when performance-review season arrived. She had to write 19.

The company hired a new counterpart for her, charged with managing, and Byrne-Haber focused on strategy. Letting go was harder than she expected. It took her three months to unsubscribe from all the manager-only Slack channels, email lists and meetings she had been looped in on. When colleagues reached out with questions, she’d pause to determine whether the queries were still related to her responsibilities. If not, she forced herself to forward them to the new manager, even when she knew the answer.

“It felt awkward,” says Byrne-Haber, now at work on her own startup. “But that’s not my job anymore.”

Luxury Brands Are in a Winner-Takes-All Phase

Louis Vuitton’s owner designed the medals for the Paris Olympic Games. It can’t be easy to see rival Hermès make off with gold in the second-quarter sales heat.

France’s three most powerful luxury-goods companies reported very mixed second-quarter results last week. On Tuesday, LVMH Moët Hennessy Louis Vuitton said sales in the three months through June rose by a disappointing 1% compared with the same period last year. Gucci owner Kering followed with an 11% fall for the quarter and issued a profit warning. Hermès left its competitors in the dust with a 13% increase in sales over the same period.

Hermès captured more than 100% of the incremental growth in the industry in the latest quarter. Luxury shoppers spent €440 million—equivalent to $477.6 million at current exchange rates—more in the French brand’s stores than they did in the same period of last year. They spent €400 million less on all other luxury brands combined, based on analysis by Bank of America .

This points to a double whammy for high-end brands, which face challenges at both ends of the consumer spectrum they serve.

It has been clear for months that middle-class shoppers in the U.S. and China, the luxury industry’s two most important markets, have reined in their purchasing.

Chinese consumers are saving rather than spending because the value of their homes is falling. Lower-income and middle-income Americans who developed a taste for luxury during the pandemic have pulled back sharply as they have burned through excess savings.

Now, wealthy consumers, too, seem to be getting choosier about which brands they will and won’t buy. Hermès Chief Executive Axel Dumas said there is a “flight to quality” under way in the luxury industry. This shift is benefiting the Birkin handbag maker , which has a reputation for timeless designs.

Chinese buyers in particular are avoiding flashy and logo-heavy brands as worries about the country’s economy and real-estate challenges grow.

Jewellery sales are also holding up as shoppers look for goods that are more likely to hold their value than clothing or handbags. Cartier’s owner Richemont said its jewellery sales rose 4% in the quarter, although the company’s overall sales were weighed down by weak demand for its watch and fashion brands. Kering jewellery labels Boucheron and Pomellato were rare bright spots in its portfolio.

The outlook is harsh for brands such as Gucci and Burberry that are in turnaround mode. The latter issued a profit warning earlier this month and replaced its CEO in an admission that a years-long push to make the British trench-coat maker more exclusive had failed. Its shares have fallen to levels not seen since 2010.

Both brands face an uphill battle to lure shoppers. Neither Gucci nor Burberry is known for the classic designs now in vogue. The labels might also have exacerbated the slump, as the sharp price increases that luxury brands implemented in recent years have sidelined aspirational shoppers.

Luxury stocks are diverging. Shares in Richemont and Hermès have gained 15% and 8% respectively so far this year, with everyone else in the red.

Investors are taking their cue from wealthy shoppers: In troubled times, the most exclusive brands are the safest bet.

Driving Lamborghini’s $600,000 Ultra-Powerful Plug-In Hybrid

No longer are supercars powered strictly by muscular V8 and V12 engines, producing a mighty roar as they burn gallons of gas at a ferocious rate. Today’s entries can have hybrid, plug-in hybrid, or pure electric drive. But they’re still awesomely fast, with neck-snapping acceleration.

The new Lamborghini Revuelto, a novel form of plug-in hybrid, puts out an eye-opening 1,001 horsepower (with 739 pound-feet of torque) via a combination of three electric motors (two on the front axle) and a mid-mounted—and exposed to the elements—V12 that, by itself, produces 825 horsepower. It manages to produce more power with some beneficial weight loss. That’s coupled to an eight-speed dual-clutch automatic (with manual paddles) and a 3.8-kilowatt-hour battery pack (with LG cells) that gives the Revuelto five or six miles of all-electric travel.

Hybrid drive in the Revuelto is not so much to achieve better fuel economy, though that’s one result, but is primarily a way of boosting power output as needed. It also yields all-wheel drive. Sales started early this year, and Lamborghini plans to produce about 1,500 to 1,600 Revueltos annually (with the supply limited by the company’s ability to produce its carbon-fiber structure). The inventory is sold out until 2026. As is true of many supercar companies, the SUV is the biggest seller—Lamborghini produces about 5,000 Urus SUV models each year.

The Lamborghini Revueltos in convoy in the Hudson Valley.
Lamborghini photo

The list price of the 2024 Revuelto is US$604,363. As tested, with the biggest option being US$13,100 for the special greyish paint, the bottom line was US$681,258. Lamborghini handed over the Revuelto keys at the 140-acre Wildflower Farms resort in Gardiner, N.Y., for a 90-minute drive around the scenic Hudson Valley. Although the car is capable of a stated 217 miles per hour in the right context, it was still huge fun to drive it at much more moderate speeds on the curvy local roads.

Matteo Ortenzi, product line director for the Revuelto, explained that having two motors up front increases the opportunity for effective torque vectoring, which improves handling by delivering power to the individual wheels as needed. “The feel is of a lighter and more powerful car,” Ortenzi says. “We didn’t build the Revuelto just to say we did a hybrid.”

As in other hybrids, the Revuelto returns power to the battery on deceleration, a process called “regenerative” braking or in Ortenzi’s words, “using negative torque.” After the 90-minute drive, the Revuelto still had a 90% charge. Lamborghini doesn’t think owners will need to plug it in often, though it provides a charging cord. The charge portal is actually under the front hood, a “frunk” where the car has its limited luggage space.

A row of Revueltos with scissor doors up.
Jim Motavalli photo

Entering through the vertically opening scissor doors requires some agility, but soon becomes second nature. Leg room is good, and the bolstered seats hold the driver in firmly—a good thing considering the speeds and g-forces the car can achieve. The gauges are brightly digital, with huge single-digit numbers for the gear selected. There’s an 8.4-inch touchscreen mounted centrally, and a third 12.3-inch unit for the passenger. The start-stop button is under a military-grade protective cover.

The drive started in EV mode, yielding a quiet getaway that didn’t disturb resort guests. Small dials on the dash control the driving modes. Città (city) is for city electric, Strada (street) for comfortable cruising, Sport (self-explanatory), and Corsa (race, for total performance).

All the modes were sampled, but Strada was a nice balance of performance and driving pleasure. Sometimes using paddles seems not worth the bother, but in the Revuelto the big flippers provided instant gear changes and a nice feeling of control. Slowing down, the transmission acts on its own to downshift. Everything works together: the tight steering (with rear-wheel steering, too), the firm but not harsh suspension, and the hugely reassuring carbon-ceramic brakes. The engine barks out a very Italian song. It’s quite a driver’s car, though not one that can take the family to Disneyland.

The Revueltos engine is exposed to the elements.
Jim Motavalli photo

In the classic muscle car, huge V8 engines were stuffed under the hoods of regular passenger vehicles, sometimes without much thought as to how the powerful result would get around corners or stop. The Revuelto, despite that fearsome 1,001 horsepower, seems to have been fully engineered to handle what it puts on the ground. It can reach 62 miles per hour in 2.5 seconds, with the driver in firm control.

Plug-in hybrids like the Revuelto are a big step toward battery EVs. Lamborghini showed the Lanzador, a fully electric concept car, during Monterey Car Week in 2023 . Exactly when a production model will appear is unclear. “It’s not when, but how,” Ortenzi says. “The world doesn’t need just another electric car; it needs an electric Lamborghini.”

Population of the World’s Ultra-Rich Grew 7.6% Last Year, With Continued Concentration at the Top

The ultra-wealthy rebounded in size and influence last year.

The global population of the ultra-rich rose by 7.6% to 426,300 individuals last year, with a correlating 7.1% jump in net worth to US$49.2 trillion, according to Altrata’s annual report on those with at least US$30 million in investable assets.

The majority of this group (80%) have a net worth between US$30 million and US$100 million, while those worth US$100 million to US$1 billion make up most of the remaining 20%. Billionaires represent only a sliver of the ultra-rich population (0.8%), but hold 24% of all wealth.

The largest percentage of wealthy individuals in the world live in North America. Their numbers continued to rise last year, increasing by 11.9% to 161,280. This increases the region’s global share of ultra rich  to 37.8%. The collective net worth of this group rose by a similar percentage, to US$18.6 trillion.

The U.S. continues to far outpace any other nation in terms of wealth. The country saw a 13% rise in its ultra-wealthy population making it home to a little more than one-third of the global ultra-wealthy population, according to the report.

Meanwhile, the pace of wealth growth in Asia appears to  be shifting. Hong Kong was the only Chinese city to make the  top 10 of the world’s wealthiest locales amid a “structural slowing” of China’s economy and the mainland’s tightening grip on the city. Hong Kong which saw no material change in its wealth status, ranked second behind New York in terms of number of wealthy individuals.

In contrast, the report said that three of the fastest-growing cities among the top 10 for the ultra wealthy in the next five years will be in India. Bengaluru, Hyderabad, and Delhi are expected to grow at an annual average rate of 14% to 16%.

In other regions, the populations of the ultra-rich declined by almost 6% in the Middle East and by nearly double digits in Africa. But more individuals reached the upper wealth tiers in Europe, where the ultra-rich gained 9.4% more members, and in Central and South America, which gained 18.2% more.

The world’s wealthiest also account for a significant amount of global spending and giving. The report said the group spent US$118 billion on personal luxury goods last year, equivalent to 30% of all spending in the category. They also accounted for US$190 billion of philanthropic donations, equal to 38% of all giving.

Looking ahead, the report predicts that this ultra-wealthy population will grow to more than 587,000 individuals by 2028 (an increase of more than 160,000 from 2023 figures), adding US$19 trillion of newly created wealth.

Navigating Paris Real Estate Can Feel Like an Olympic Sport. Here’s How to Win Gold.

PARIS —Paris has long been a byword for luxurious living. The traditional components of the upscale home, from parquet floors to elaborate mouldings, have their origins here. Yet settling down in just the right address in this low-rise, high-density city may be the greatest luxury of all.

Tradition reigns supreme in Paris real estate, where certain conditions seem set in stone—the western half of the city, on either side of the Seine, has long been more expensive than the east. But in the fashion world’s capital, parts of the housing market are also subject to shifting fads. In the trendy, hilly northeast, a roving cool factor can send prices in this year’s hip neighbourhood rising, while last year’s might seem like a sudden bargain.

This week, with the opening of the Olympic Games and the eyes of the world turned toward Paris, The Wall Street Journal looks at the most expensive and desirable areas in the City of Light.

The Most Expensive Arrondissement: the 6th

Known for historic architecture, elegant apartment houses and bohemian street cred, the 6th Arrondissement is Paris’s answer to Manhattan’s West Village. Like its New York counterpart, the 6th’s starving-artist days are long behind it. But the charm that first wooed notable residents like Gertrude Stein and Jean-Paul Sartre is still largely intact, attracting high-minded tourists and deep-pocketed homeowners who can afford its once-edgy, now serene atmosphere.

Le Breton George V Notaires, a Paris notary with an international clientele, says the 6th consistently holds the title of most expensive arrondissement among Paris’s 20 administrative districts, and 2023 was no exception. Last year, average home prices reached $1,428 a square foot—almost 30% higher than the Paris average of $1,100 a square foot.

According to Meilleurs Agents, the Paris real estate appraisal company, the 6th is also home to three of the city’s five most expensive streets. Rue de Furstemberg, a secluded loop between Boulevard Saint-Germain and the Seine, comes in on top, with average prices of $2,454 a square foot as of March 2024.

For more than two decades, Kyle Branum, a 51-year-old attorney, and Kimberly Branum, a 60-year-old retired CEO, have been regular visitors to Paris, opting for apartment rentals and ultimately an ownership interest in an apartment in the city’s 7th Arrondissement, a sedate Left Bank district known for its discreet atmosphere and plutocratic residents.

“The 7th was the only place we stayed,” says Kimberly, “but we spent most of our time in the 6th.”

In 2022, inspired by the strength of the dollar, the Branums decided to fulfil a longstanding dream of buying in Paris. Working with Paris Property Group, they opted for a 1,465-square-foot, three-bedroom in a building dating to the 17th century on a side street in the 6th Arrondissement. They paid $2.7 million for the unit and then spent just over $1 million on the renovation, working with Franco-American visual artist Monte Laster, who also does interiors.

The couple, who live in Santa Barbara, Calif., plan to spend about three months a year in Paris, hosting children and grandchildren, and cooking after forays to local food markets. Their new kitchen, which includes a French stove from luxury appliance brand Lacanche, is Kimberly’s favourite room, she says.

Another American, investor Ashley Maddox, 49, is also considering relocating.

In 2012, the longtime Paris resident bought a dingy, overstuffed 1,765-square-foot apartment in the 6th and started from scratch. She paid $2.5 million and undertook a gut renovation and building improvements for about $800,000. A centrepiece of the home now is the one-time salon, which was turned into an open-plan kitchen and dining area where Maddox and her three children tend to hang out, American-style. Just outside her door are some of the city’s best-known bakeries and cheesemongers, and she is a short walk from the Jardin du Luxembourg, the Left Bank’s premier green space.

“A lot of the majesty of the city is accessible from here,” she says. “It’s so central, it’s bananas.” Now that two of her children are going away to school, she has listed the four-bedroom apartment with Varenne for $5 million.

The Most Expensive Neighbourhoods: Notre-Dame and Invalides

Garrow Kedigian is moving up in the world of Parisian real estate by heading south of the Seine.

During the pandemic, the Canada-born, New York-based interior designer reassessed his life, he says, and decided “I’m not going to wait any longer to have a pied-à-terre in Paris.”

He originally selected a 1,130-square-foot one-bedroom in the trendy 9th Arrondissement, an up-and-coming Right Bank district just below Montmartre. But he soon realised it was too small for his extended stays, not to mention hosting guests from out of town.

After paying about $1.6 million in 2022 and then investing about $55,000 in new decor, he put the unit up for sale in early 2024 and went house-shopping a second time. He ended up in the Invalides quarter of the 7th Arrondissement in the shadow of one Paris’s signature monuments, the golden-domed Hôtel des Invalides, which dates to the 17th century and is fronted by a grand esplanade.

His new neighbourhood vies for Paris’s most expensive with the Notre-Dame quarter in the 4th Arrondissement, centred on a few islands in the Seine behind its namesake cathedral. According to Le Breton, home prices in the Notre-Dame neighbourhood were $1,818 a square foot in 2023, followed by $1,568 a square foot in Invalides.

After breaking even on his Right Bank one-bedroom, Kedigian paid $2.4 million for his new 1,450-square-foot two-bedroom in a late 19th-century building. It has southern exposures, rounded living-room windows and “gorgeous floors,” he says. Kedigian, who bought the new flat through Junot Fine Properties/Knight Frank, plans to spend up to $435,000 on a renovation that will involve restoring the original 12-foot ceiling height in many of the rooms, as well as rescuing the ceilings’ elaborate stucco detailing. He expects to finish in 2025.

Over in the Notre-Dame neighbourhood, Belles demeures de France/Christie’s recently sold a 2,370-square-foot, four-bedroom home for close to the asking price of about $8.6 million, or about $3,630 a square foot. Listing agent Marie-Hélène Lundgreen says this places the unit near the very top of Paris luxury real estate, where prime homes typically sell between $2,530 and $4,040 a square foot.

The Most Expensive Suburb: Neuilly-sur-Seine

The Boulevard Périphérique, the 22-mile ring road that surrounds Paris and its 20 arrondissements, was once a line in the sand for Parisians, who regarded the French capital’s numerous suburbs as something to drive through on their way to and from vacation. The past few decades have seen waves of gentrification beyond the city’s borders, upgrading humble or industrial districts to the north and east into prime residential areas. And it has turned Neuilly-sur-Seine, just northwest of the city, into a luxury compound of first resort.

In 2023, Neuilly’s average home price of $1,092 a square foot made the leafy, stately community Paris’s most expensive suburb.

Longtime residents, Alain and Michèle Bigio, decided this year is the right time to list their 7,730-square-foot, four-bedroom townhouse on a gated Neuilly street.

The couple, now in their mid 70s, completed the home in 1990, two years after they purchased a small parcel of garden from the owners next door for an undisclosed amount. Having relocated from a white-marble château outside Paris, the couple echoed their previous home by using white- and cream-coloured stone in the new four-story build. The Bigios, who will relocate just back over the border in the 16th Arrondissement, have listed the property with Emile Garcin Propriétés for $14.7 million.

The couple raised two adult children here and undertook upgrades in their empty-nester years—most recently, an indoor pool in the basement and a new elevator.

The cool, pale interiors give way to dark and sardonic images in the former staff’s quarters in the basement where Alain works on his hobby—surreal and satirical paintings, whose risqué content means that his wife prefers they stay downstairs. “I’m not a painter,” he says. “But I paint.”

The Trendiest Arrondissement: the 9th

French interior designer Julie Hamon is theatre royalty. Her grandfather was playwright Jean Anouilh, a giant of 20th-century French literature, and her sister is actress Gwendoline Hamon. The 52-year-old, who divides her time between Paris and the U.K., still remembers when the city’s 9th Arrondissement, where she and her husband bought their 1,885-square-foot duplex in 2017, was a place to have fun rather than put down roots. Now, the 9th is the place to do both.

The 9th, a largely 19th-century district, is Paris at its most urban. But what it lacks in parks and other green spaces, it makes up with nightlife and a bustling street life. Among Paris’s gentrifying districts, which have been transformed since 2000 from near-slums to the brink of luxury, the 9th has emerged as the clear winner. According to Le Breton, average 2023 home prices here were $1,062 a square foot, while its nearest competitors for the cool crown, the 10th and the 11th, have yet to break $1,011 a square foot.

A co-principal in the Bobo Design Studio, Hamon—whose gut renovation includes a dramatic skylight, a home cinema and air conditioning—still seems surprised at how far her arrondissement has come. “The 9th used to be well known for all the theatres, nightclubs and strip clubs,” she says. “But it was never a place where you wanted to live—now it’s the place to be.”

With their youngest child about to go to college, she and her husband, 52-year-old entrepreneur Guillaume Clignet, decided to list their Paris home for $3.45 million and live in London full-time. Propriétés Parisiennes/Sotheby’s is handling the listing, which has just gone into contract after about six months on the market.

The 9th’s music venues were a draw for 44-year-old American musician and piano dealer, Ronen Segev, who divides his time between Miami and a 1,725-square-foot, two-bedroom in the lower reaches of the arrondissement. Aided by Paris Property Group, Segev purchased the apartment at auction during the pandemic, sight unseen, for $1.69 million. He spent $270,000 on a renovation, knocking down a wall to make a larger salon suitable for home concerts.

During the Olympics, Segev is renting out the space for about $22,850 a week to attendees of the Games. Otherwise, he prefers longer-term sublets to visiting musicians for $32,700 a month.

Most Exclusive Address: Avenue Junot

Hidden in the hilly expanses of the 18th Arrondissement lies a legendary street that, for those in the know, is the city’s most exclusive address. Avenue Junot, a bucolic tree-lined lane, is a fairy-tale version of the city, separate from the gritty bustle that surrounds it.

Homes here rarely come up for sale, and, when they do, they tend to be off-market, or sold before they can be listed. Martine Kuperfis—whose Paris-based Junot Group real-estate company is named for the street—says the most expensive units here are penthouses with views over the whole of the city.

In 2021, her agency sold a 3,230-square-foot triplex apartment, with a 1,400-square-foot terrace, for $8.5 million. At about $2,630 a square foot, that is three times the current average price in the whole of the 18th.

Among its current Junot listings is a 1930s 1,220-square-foot townhouse on the avenue’s cobblestone extension, with an asking price of $2.8 million.

Preparing for the Next Worldwide Tech Outage

As tech leaders race to bring Windows systems back online after Friday’s software update by cybersecurity company CrowdStrike crashed around 8.5 million machines worldwide, experts share with CIO Journal their takeaways for preparing for the next major information technology outage.

Be familiar with how vendors develop, test and release their software

IT leaders should hold vendors deeply integrated within IT systems, such as CrowdStrike , to a “very high standard” of development, release quality and assurance, said Neil MacDonald , a Gartner vice president.

“Any security vendor has a responsibility to do extensive regression testing on all versions of Windows before an update is rolled out,” he said.

That involves asking existing vendors to explain how they write software, what testing they do and whether customers may choose how quickly to roll out an update.

“Incidents like this remind all of us in the CIO community of the importance of ensuring availability, reliability and security by prioritizing guardrails such as deployment and testing procedures and practices,” said Amy Farrow, chief information officer of IT automation and security company Infoblox.

Re-evaluate how your firm accepts software updates from ‘trusted’ vendors

While automatically accepting software updates has become the norm—and a recommended security practice—the CrowdStrike outage is a reminder to take a pause, some CIOs said.

“We still should be doing the full testing of packages and upgrades and new features,” said Paul Davis, a field chief information security officer at software development platform maker JFrog . undefined undefined Though it’s not feasible to test every update, especially for as many as hundreds of software vendors, Davis said he makes it a priority to test software patches according to their potential severity and size.

Automation, and maybe even artificial intelligence-based IT tools, can help.

“Humans are not very good at catching errors in thousands of lines of code,” said Jack Hidary, chief executive of AI and quantum company SandboxAQ. “We need AI trained to look for the interdependence of new software updates with the existing stack of software.”

Develop a disaster recovery plan

An incident rendering Windows computers unusable is similar to a natural disaster with systems knocked offline, said Gartner’s MacDonald. That’s why businesses should consider natural disaster recovery plans for maintaining the resiliency of their operations.

One way to do that is to set up a “clean room,” or an environment isolated from other systems, to use to bring critical systems back online, according to Chirag Mehta, a cybersecurity analyst at Constellation Research.

Businesses should also hold tabletop exercises to simulate risk scenarios, including IT outages and potential cyber threats, Mehta said.

Companies that back up data regularly were likely less impacted by the CrowdStrike outage, according to Victor Zyamzin, chief business officer of security company Qrator Labs. “Another suggestion for companies, and we’ve been saying that again and again for decades, is that you should have some backup procedure applied, running and regularly tested,” he said.

Review vendor and insurance contracts

For any vendor with a significant impact on company operations , MacDonald said companies can review their contracts and look for clauses indicating the vendors must provide reliable and stable software.

“That’s where you may have an advantage to say, if an update causes an outage, is there a clause in the contract that would cover that?” he said.

If it doesn’t, tech leaders can aim to negotiate a discount serving as a form of compensation at renewal time, MacDonald added.

The outage also highlights the importance of insurance in providing companies with bottom-line protection against cyber risks, said Peter Halprin, a partner with law firm Haynes Boone focused on cyber insurance.

This coverage can include protection against business income losses, such as those associated with an outage, whether caused by the insured company or a service provider, Halprin said.

Weigh the advantages and disadvantages of the various platforms

The CrowdStrike update affected only devices running Microsoft Windows-based systems , prompting fresh questions over whether enterprises should rely on Windows computers.

CrowdStrike runs on Windows devices through access to the kernel, the part of an operating system containing a computer’s core functions. That’s not the same for Apple ’s Mac operating system and Linux, which don’t allow the same level of access, said Mehta.

Some businesses have converted to Chromebooks , simple laptops developed by Alphabet -owned Google that run on the Chrome operating system . “Not all of them require deeper access to things,” Mehta said. “What are you doing on your laptop that actually requires Windows?”

‘Are There Any Parisians Left?’ The Olympics Have Residents Fleeing the City.

As Paris makes its final preparations for the Olympic games, its residents are busy with their own—packing their suitcases, confirming their reservations, and getting out of town.

Worried about the hordes of crowds and overall chaos the Olympics could bring, Parisians are fleeing the city in droves and inundating resort cities around the country. Hotels and holiday rentals in some of France’s most popular vacation destinations—from the French Riviera in the south to the beaches of Normandy in the north—say they are expecting massive crowds this year in advance of the Olympics. The games will run from July 26-Aug. 1.

“It’s already a major holiday season for us, and beyond that, we have the Olympics,” says Stéphane Personeni, general manager of the Lily of the Valley hotel in Saint Tropez. “People began booking early this year.”

Personeni’s hotel typically has no issues filling its rooms each summer—by May of each year, the luxury hotel typically finds itself completely booked out for the months of July and August. But this year, the 53-room hotel began filling up for summer reservations in February.

“We told our regular guests that everything—hotels, apartments, villas—are going to be hard to find this summer,” Personeni says. His neighbours around Saint Tropez say they’re similarly booked up.

As of March, the online marketplace Gens de Confiance (“Trusted People”), saw a 50% increase in reservations from Parisians seeking vacation rentals outside the capital during the Olympics.

Already, August is a popular vacation time for the French. With a minimum of five weeks of vacation mandated by law, many decide to take the entire month off, renting out villas in beachside destinations for longer periods.

But beyond the typical August travel, the Olympics are having a real impact, says Bertille Marchal, a spokesperson for Gens de Confiance.

“We’ve seen nearly three times more reservations for the dates of the Olympics than the following two weeks,” Marchal says. “The increase is definitely linked to the Olympic Games.”

Worried about the hordes of crowds and overall chaos the Olympics could bring, Parisians are fleeing the city in droves and inundating resort cities around the country.
Getty Images

According to the site, the most sought-out vacation destinations are Morbihan and Loire-Atlantique, a seaside region in the northwest; le Var, a coastal area within the southeast of France along the Côte d’Azur; and the island of Corsica in the Mediterranean.

Meanwhile, the Olympics haven’t necessarily been a boon to foreign tourism in the country. Many tourists who might have otherwise come to France are avoiding it this year in favour of other European capitals. In Paris, demand for stays at high-end hotels has collapsed, with bookings down 50% in July compared to last year, according to UMIH Prestige, which represents hotels charging at least €800 ($865) a night for rooms.

Earlier this year, high-end restaurants and concierges said the Olympics might even be an opportunity to score a hard-get-seat at the city’s fine dining.

In the Occitanie region in southwest France, the overall number of reservations this summer hasn’t changed much from last year, says Vincent Gare, president of the regional tourism committee there.

“But looking further at the numbers, we do see an increase in the clientele coming from the Paris region,” Gare told Le Figaro, noting that the increase in reservations has fallen directly on the dates of the Olympic games.

Michel Barré, a retiree living in Paris’s Le Marais neighbourhood, is one of those opting for the beach rather than the opening ceremony. In January, he booked a stay in Normandy for two weeks.

“Even though it’s a major European capital, Paris is still a small city—it’s a massive effort to host all of these events,” Barré says. “The Olympics are going to be a mess.”

More than anything, he just wants some calm after an event-filled summer in Paris, which just before the Olympics experienced the drama of a snap election called by Macron.

“It’s been a hectic summer here,” he says.

Hotels and holiday rentals in some of France’s most popular vacation destinations say they are expecting massive crowds this year in advance of the Olympics.
AFP via Getty Images

Parisians—Barré included—feel that the city, by over-catering to its tourists, is driving out many residents.

Parts of the Seine—usually one of the most popular summertime hangout spots —have been closed off for weeks as the city installs bleachers and Olympics signage. In certain neighbourhoods, residents will need to scan a QR code with police to access their own apartments. And from the Olympics to Sept. 8, Paris is nearly doubling the price of transit tickets from €2.15 to €4 per ride.

The city’s clear willingness to capitalise on its tourists has motivated some residents to do the same. In March, the number of active Airbnb listings in Paris reached an all-time high as hosts rushed to list their apartments. Listings grew 40% from the same time last year, according to the company.

With their regular clients taking off, Parisian restaurants and merchants are complaining that business is down.

“Are there any Parisians left in Paris?” Alaine Fontaine, president of the restaurant industry association, told the radio station Franceinfo on Sunday. “For the last three weeks, there haven’t been any here.”

Still, for all the talk of those leaving, there are plenty who have decided to stick around.

Jay Swanson, an American expat and YouTuber, can’t imagine leaving during the Olympics—he secured his tickets to see ping pong and volleyball last year. He’s also less concerned about the crowds and road closures than others, having just put together a series of videos explaining how to navigate Paris during the games.

“It’s been 100 years since the Games came to Paris; when else will we get a chance to host the world like this?” Swanson says. “So many Parisians are leaving and tourism is down, so not only will it be quiet but the only people left will be here for a party.”

Google Fails to ‘Wow’ as AI Bills Mount

It’s good to be Google these days. But it isn’t easy, and it will keep getting harder.

Second-quarter results from parent company Alphabet on Tuesday afternoon showed strength in advertising and cloud revenue along with a record high in operating profit as the Silicon Valley titan, once known for lavish employee perks, continues to clamp down on most costs, save for those designed to build out generative artificial intelligence capabilities .

But the results also offered “no excitement,” in the words of Jefferies analyst Brent Thill . Overall revenue exceeded Wall Street’s consensus projection by just 0.6%—the lowest beat percentage in at least five years, according to FactSet. YouTube advertising revenue also came in lower than analysts expected. Alphabet’s previous report, three months ago , offered bigger positive surprises in both revenue and earnings growth, with the announcement of the company’s first-ever dividend thrown in for good measure. Alphabet’s stock had jumped nearly 17% since that report; the shares gave up about 4% in premarket trading on Wednesday.

Tuesday’s results also set the stage for what might be a more challenging second half of the year. For one, comparisons will be tougher as the second half of last year had Google nearly recovered from an earlier advertising slump. Google also didn’t fully ramp up its spending on AI infrastructure until well into the second half of 2023; capital expenditures in the first half of 2023 were barely half of the $25.2 billion the company has spent in the first half of this year.

That spending won’t be taking a breather any time soon, even as Google has pared back other costs and even brought its head count down by more than 1,300 positions in the most recent quarter. Alphabet said Tuesday that capex will be at or above $12 billion a quarter for the second half of the year, likely leading to a total outlay of more than $49 billion for the year—84% higher than what the company has averaged annually over the past five years.

“Look, obviously we are at the early stage of what I view as a very transformative area,” Alphabet Chief Executive Sundar Pichai said during Tuesday’s earnings call when asked by an analyst about the company’s AI investments. He added that “the risk of underinvesting is dramatically greater than the risk of over investing for us here,” not mentioning the record amounts of capex that tech rivals Microsoft , Amazon.com and Meta Platforms are pouring into the same thing.

Google has the resources: Alphabet’s net cash pile of nearly $98 billion is substantially bigger than those of even its deep-pocketed peers. But putting that money to work is getting to be a challenge. The Wall Street Journal reported Monday that Google’s talks to acquire cybersecurity startup Wiz have fallen apart. The purported $23 billion deal would have been Google’s largest ever and most certainly would have drawn the type of close regulatory scrutiny that has lately been keeping tech mergers in limbo for 18 months or more. Such an uncertain payoff reportedly was a concern among Wiz and its investors; Google’s acquisition of Fitbit in 2021 for less than one-tenth that price took nearly 15 months to close.

Google is also going back to the drawing board on a long-running plan to phase out the use of internet tracking technology known as “cookies,” despised by privacy advocates but depended upon by advertisers. Google was building up an alternative technology called “privacy sandbox,” but that plan drew a lot of opposition from advertisers and regulators worried that it would further cement the company’s internet advertising dominance. Google said Monday it would instead offer users a prompt to allow them to opt out of cookie tracking.

That move is unlikely to dent Google’s powerful search ad business. But that and the failed Wiz talks show the growing constraints the company is operating under as regulators look even more closely at big tech’s position, and judges and juries start weighing in. A verdict in the federal government’s antitrust case against Google is expected before the end of the year and could result in a ruling that would seek a breakup of the $250-billion-a-year advertising juggernaut.

Google’s latest results were good, but good isn’t always enough.

Penthouse Atop a French Riviera Hotel that Hosted Ernest Hemingway to Coco Chanel Lists for €40 Million

A lavish penthouse on the French Riviera within a former Art Deco hotel that was frequented by a veritable who’s who of writers, artists and actors has hit the market for €40 million (US$43.4 million).

The three-level unit sits atop Le Provençal, a residential development converted from the Hôtel Provençal, which was built in the mid-1920s at the direction of American millionaire Frank Jay Gould.

In its prime, the 290-room hotel in the resort town Juan-les-Pins was the place to see and be seen.

“Chanel invented pyjamas as beachwear there. Ernest Hemingway sat at the bar, and Edith Piaf partied in the ballroom. Picasso painted the beach scenes, and Man Ray photographed them,” according to The New York Times.

The penthouse has a private pool.
Caudwell

 

The hotel shuttered in 1977, and its transformation into 39 residences by British developer Caudwell is expected to be completed next year.

Entered via private elevator and spanning upward of 9,000 square feet, the six-bedroom penthouse, which hit the market earlier this week, spans the east wing of the building across the eighth, ninth and 10th floors.

For its interiors, the developer aimed to channel the glamour for which the area is renowned, and turned to the outfits of famous names who frequently visited, along with the colours of the French Riviera, as inspiration.

The primary bedroom suite, for example—which has two bathrooms, dressing rooms and a private terrace—pays homage to the pink hues of the surroundings and the elaborate caftans that Elizabeth Taylor wore on one of her many visits to the area.

The interiors are inspired by the glamour of the area.
Caudwell

The home also boasts a family room, a home cinema, a gym, a family kitchen and breakfast room, a sculptural oval staircase, vast living and entertaining spaces, and impressive views along the French Riviera.

There’s a whopping 3,789 square feet of private terraces across the home—making its outdoor space larger than many single-family homes—a private pool and six parking bays in the development’s secure parking garage.

“With their private terraces, swimming pools and far-reaching panoramic views the penthouses at Le Provençal are the jewels in the [development’s] crown,” said Lars Christiaanse, group director of sales at Caudwell.