Week of March April 1 – April 07, 2026

There was no news letter mailed out on April 1. I'd like for that to have been a good April fools joke, but sadly, I just didn't hit send. I was thorough enough to post it online last week though, so if you would like to have a read, it's there for you. 🍀

This week's news is going to be an overall of the industry as well as current happenings, but while I was doing my month in research for the newsletter you never received, I stumbled upon some interesting bits. I figured since you probably didn't see the last one, now was as good a time as any.

Outlier / Scale AI — The Degradation Story Is Real

The post-Meta $14.3B investment fallout is still reverberating what we've learned:

• July 2025: Scale laid off 200 employees and 500 contractors, then funneled many of them into Outlier as gig workers
• October 2025: Scale shut down its Dallas generalist contractor team entirely — explicit pivot toward technical/expert work only
• December 2025 (DNYUZ investigation): Pay on Outlier dropped from ~$50/hr to ~$20/hr effective rates. One project allowed 3 minutes of work every two days — a $0.99 payout. Workers reported 40 hours of unpaid onboarding
• OpenAI and Google both pulled their data contracts from Scale after the Meta deal, citing competitive concerns — directly reducing the work volume hitting Outlier
• Aether specifically: Still active, described by Outlier as "quick, chunkable, low-lift tasks." Workers are being removed after 2–3 weeks. Grand prize contest ($20K) suggests they're gamifying it to retain the shrinking cohort
• Scale is pivoting hard to defense/government (up to $199M in contracts) and robotics. The generalist AI training era for Scale is closing

Mercor — Breaking Right News Right Now

This is active breaking news, if you do work at Mercor, you should have already received a vague email discussing the breach - that they don't know to what extent your information has been exposed yet -

• Major cyberattack via a LiteLLM supply chain vulnerability. 4TB of data stolen: source code, contractor PII, employer data for 40,000+ people
• 5 contractor lawsuits filed in a single week (April 1–7), including a proposed nationwide class action (Gill v. Mercor.io)
• Meta has paused all contracts with Mercor after the breach — direct revenue hit
• Scale AI had already sued Mercor in September 2025 for allegedly poaching their clients via a recruited sales rep
• Mercor raised $350M at a $10B valuation just 6 months ago. Right now it's on fire, legally

DataAnnotation — Holding Steady, But...

• Pay rates appear stable ($20–$50/hr generalist, $50–$100+ specialist)
• A class action lawsuit has been filed against the parent company (2026)
• Silent account bans with no appeal remain the #1 complaint and the core legal exposure
• Long waitlists, not actively expanding

Alignerr — Actually One of the Brighter Spots

• 6 active projects running in March 2026 — more work available than the waitlist reputation suggests
• Hiring and onboarding still flowing
• No major layoffs or policy crises reported
• Labelbox ($3.2B backing) appears stable

Telus AI — Growth, Not Contraction

• Parent company shed 2,800 Canadian jobs while adding 6,100 global gig workers to the AI division
• Deliberately moving work offshore/to lower-cost markets. The structural shift is accelerating

Babel Audio — Small and Shaky

• Undocumented rule changes (November 2025), workers removed without warning (January 2026)
• 58 Indeed reviews, communication is described as poor
• Still operational but not a stable primary income source

The Bigger Picture

The market is in a constant state of rapid change:

• Generalist work is being squeezed out — offshore pricing or automated away
• Expert work (law, medicine, STEM) is booming — $45–$250/hr, actively hiring
• New entrants: DoorDash launched an AI training program for its 8 million couriers (March 2026) — potentially the biggest new generalist entrant. Micro1 grew from $7M to $50M
• Legal pressure is mounting industry-wide — Scale AI faced DOL + city probes, Mercor has 5 lawsuits, DataAnnotation has a class action. Contractor misclassification is becoming the regulatory flashpoint