The official announcement:And:

Good. There's no reason they can't simply run the analysis against both male and female templates rather than the agent specifying gender. And use separate patterns for the top and bottom. This isn't a big change to the system.

Since most frequent travelers have some sort of ExtortionCheck, there's been very little, if any, incidents of groping or downright sexual assault in recent years. The TSA is simply jumping on the woke bandwagon and taking credit for something that's a no-brainer. Just turn off the nude-o-scope in the crotch area and everybody's OK.

Not stated in the two links above is cost of this change.

TSA’s scanner ‘inclusive’ upgrade for transgender passengers costs taxpayers $18.6 million

And the pricing contract is absurd.

The first scan is $18.6 million.

Each after that is free.

I'd hate to go first.

Actually, it is mentioned in the TSA National Press Release, which is the first article which I linked in the OP:

I scanned the linked article and missed that completely, my bad. Still seems an excessive amount of tax dollars to fix a problem that could be resolved by just ditching unnecessary Whole Body Scanners.

Well, those who want the AIT scanners will reply with something like this:
But, but, but, if they did that there'd be 9/11's every day! Planes would be diving out of the sky at every Prime Target in the country, including all the Super Targets and Walmart SuperCenters! There are fourteen billion terrorists in the world and every single one of them is actively planning a major attack on the US aviation industry! Think of the children! I'd rather have my teenage daughter viewed nude and strip-searched and groped than explode in mid-air!If it saves even ONE life, isn't it worth ANY price, no matter how heinous!?

Or, you know, words to that effect.

My problems with the AIT have always been three-fold:
1) The original versions of the AIT scanners created an actual image of the body, sans-clothing, to be viewed by a live human TSO in a remote location, out of sight of the human being they were ogling (in what we cynically referred to as the "perv box").
2) The original version of the AIT scanners came in two flavors - millimeter wave (MMW), which uses non-ionizing microwaves as a scanning medium, and backscatter x-ray (BSX), which uses carcinogenic ionizing x-ray radiation as a scanning medium.
3) More recent versions of the AIT scanners falsely alarm at a rate that seems to me to be many times higher than they genuinely alarm on prohibited items.

* Issue 1 has been eliminated by updated Automated Target Recognition (ATR) software.
* Issue 2 has been eliminated by removing and banning use of the BSX scanners.
* Issue 3 continues to be a problem, and probably will for many years, until the software becomes sophisticated enough to differentiate between sweat, thick clothing, forgotten IDs in pockets, folds of flesh, and actual threat items.

This change is related to Issue 3, because the ATR software wasn't, until now, sophisticated enough to accommodate different physical configurations on the suspect, er, travelers being scanned without manual input from the operating TSO. This change shows that the software continues to be improved. Hopefully this will mean fewer false alarms across the board, and not just for travelers whose appearance is misinterpreted by TSOs at the checkpoint.

Every trip I've made through a TSA Whole Body Scanner resulted in an alarm on my side of neck/shoulder area. No scars, tattoos, implants nor anything else for the machine to alert against. So in my case the MMW Whole Body Scanner fails 100% of the time. False alarms focus screeners attention on non-threat areas. I realize that TSA went all in for Whole Body Imagers even though I suspect TSA leadership knows they bought a flawed product that only makes some people believe TSA Screening is effective.

Labor-saving effort by the TSA facing a tougher hiring/retention environment?

Was the TSA seeing increased employee turnover because of a lack of will by some TSA employees to grope screened travelers whose machine strip-search scans flagged on groin or chest areas based on the sex assignment applied to the screened travelers? Not enough employee turnover for that reason.

"TSA received $18.6 million in funding within the FY22 Omnibus Appropriations to complete the development, testing, and deployment of algorithm updates to AIT units nationwide"

Wait-- $18.6M for a software upgrade?

How can you make something costing a few hundred thousand dollars cost millions? Government contracts. TSA is not immune.

Well, you're not wrong, but also, as of 2018 TSA has 945 of these things in use at 340 airports around the country (according to this article). That's $19,682 per unit, which probably includes on-site in-situ installation, configuration, and testing (in an airport, so all involved techs will either need SIDA credentials or be escorted at all times), plus part of the development costs for the software. Many software contracts also include maintenance and upkeep for a year or two. So it's not really surprising that the total comes up to just under $20k per unit.

I'm not saying that's what it should cost, but it's not all that surprising to see such a price tag on a gubment project. Heck, I'm surprised it's not more expensive.

Your claim then is that government contract pricing is not inflated?

I never made or implied any such claim. I merely said I'm not surprised to see such a price tag on a gubment procurement for software development and deployment to over 900 machines. It may be an inflated price tag, but it's perfectly typical and not in the least unexpected.