The tech jobs bust is real. Don't blame AI (yet)

https://economist.com/finance-and-economics/2026/04/13/the-tech-jobs-bust-is-real-dont-blame-ai-yet

by andsoitis • 3 months ago

118 193 3 months ago

The only reason to blame AI is that it doesn't live up to promises, so corps are betting that scale will solve the problem. So datacenter after datacenter wants to be built in areas that can't supply them water/power.

And that money sink is causing the layoffs. If AI really helped like it expected to, you would grab any dev you could so that you could have a army of 100x devs.

Humans are still cheaper for the real costs. Augmented humans are on average a few percentage points better.

mountainofdeath• 3 months ago

The same thing was said about the crazy build-out of fiber and telecommunications infrastructure. That infrastructure did prove useful but it took about 10-20 years before that was the case. It took 4G becoming broadly available and the ensuing increase of mobile devices to use at least of the overbuilt network capacity.

HerbManic• 3 months ago

While I get this stream of thought, the major difference is that the internal hardware will age much faster than the core infrastructure. The real question is, how much of these build out costs is the center itself and the hardware within.

That fiber build out will last for decades, a Blackwell GPU, not so much.

bitwize• 3 months ago

The difference is that fibre is infrastructure, LLMs are an application. Who knows, maybe they will pass and leave behind that server infra, and that's where our digital consciousnesses will live once our bodies die.

nyrikki• 3 months ago

Chalk an cheese, Wavelength Division Multiplexing took out Globalcrossing Worldcom etc…

But the secondary market that grew out of it was because once it is in the ground it has a long lifespan and low upkeep costs, this is not the same thing as ultra high power density data centers.

Cooling needs to be balanced with demand, they may not work for even cloud scale type loads without serious issues etc…

Not that it matters, my hometown has an announced DC and it is looking more and more like it is a shill, as do several of the others in the area.

Esophagus4• 3 months ago

If AI really helped like it expected to, you would grab any dev you could so that you could have an army of 100x devs.

This seems maybe a bit reductionist.

AI will have diminishing returns because at a certain point, coding is not the bottleneck and coordination is or some other thing that hasn’t been optimized yet. The exact bottleneck seems like it depends on the organization.

My theory is that in general, augmented devs are much more productive, but 100% of that gain doesn’t translate into 100% more software delivered to customers, and there is a point where coding isn’t the longest pole.

But I don’t think most orgs are at that break even yet, and I think we can still get more out of engineering before we plateau.

andsoitis2• 3 months ago

What you say is accurate. Just remember that generating code is not the only way for an engineer to amplify themselves.

0xAntonioo• 3 months ago

Feels early to blame AI for most of this. A lot of it still looks like a reset from 2021-era hiring assumptions rather than actual labor replacement

dvwcf3• 3 months ago

Over hiring is one thing.. but that wouldnt be a problem if there was an endless stream of projects to take that are value creating.

So the issue is not necessarily the over-hiring.. more that the large tech firms are running out of projects to take that are value-creating. Which is not surprising - the labour market in its currently state is absolutely not perfect in allocating labour.

It should be noted that fixing tech debt is not necessary value-creating from a financial standpoint. What engineers think is value creating has nothing to do with what a CFO determines to be a value creating project - whose job is to maximize firm value.

chii• 3 months ago

The "value" creation is tied to the interest rate.

When interest rates are low, even low value creation projects are viable.

When rates are high, those exact same projects are no longer viable.

Therefore, i would argue that the labour market is not perfectly allocating labour, but it is close enough for practical purposes.

Aurornis3• 3 months ago

I don't think it's that simple. The 2021 over-hiring was a weird time where hiring as many people as possible became a goal in itself.

There were companies growing organizations faster than they could be made productive. They acquired a lot of bureaucracy, excess structure, and inefficiency. The current backlash is trying to reverse the excess structure and middle management buildout so they can get back to more functional teams.

kypro• 3 months ago

Over hiring is one thing.. but that wouldnt be a problem if there was an endless stream of projects to take that are value creating.

I very much agree.

A lot of tech job growth during the late 2010 and pandemic period were frankly BS for a ROI perspective. Late 2010s was really the first time in tech that I started to feel like most of the stuff that needed to be built was built, and increasingly I was working on BS projects offering less and less value every year.

Consider:

- In the 80s developers were needed to write fundamental business software for word processing and spreadsheets

- In the 90s computers became mainstream and there was a huge demand for consumer software

- In the 00s the internet took off and we needed people build the web

- In the 10s the smart phone revolutionised computing and we needed people to build apps and rebuild websites to be mobile-first

But towards the late 10s entrepreneurs and investors seemingly ran out of no-brainer tech investments so increasingly started trying mental stuff still promising tech-like returns – block-chain, metaverse, Web 3.0, [insert traditional industry here] but a tech company.

I'm not saying there's nothing to build or maintain anymore, but I also no longer see where people think the exponential need for new software and software developers could come from, and I suspect this would have become obvious earlier if it wasn't for ZIRP.

But it's not a lack of productive things to build. We also have other trends hurting demand for new SWEs today. Consider how today completely non-technical people can start and scale an ecommerce company without any developers. Things that would have taken armies of developers just 10-15 years ago, can now be largely done in an afternoon on platforms like Shopify. It's actual hard to believe that just 15 years ago selling things online used to be very hard if you weren't technical.

Similarly starting in the early 2010s even being a developer got significantly easier because increasingly there was packages for everything. Things I might have spent weeks building before could now be built in days or less. And another thing that changed was sites like stackoverflow and blogs which help you solve problems and learn new skills. I remember trying to learn how to do things before 2010s was hard, and before the 00s it very hard.

And of course now we also have AI coding tools which don't just hurt the overall demand for developers, but effectively expands the supply of developers to anyone with an internet connection and computer.

So to summerise:

- There's much fewer good investments to be made in new software today.

- Where there are investments to be made you need far less developers.

- When you need developers there's far more people who can do the job.

Even if tech companies are doing well and the number of tech jobs is increasingly, the above means the average person trying to find a job in tech today will find it much, much harder than they have in the past. People working in tech today genuinely should consider a career change if they're primarily in tech for the money.

ikr6782• 3 months ago

Market saturation for tech products + new competition from vibe coded startups moving into mature enterprise spaces.

The rate of non-tech business growth has slowed, who is going to continue to buy all these cloud software services? Tricking consumers into subscribing to AI tools or extra storage only goes so far.

jarjoura2• 3 months ago

Don't conflate businesses that have tech organizations in them, with actual technology companies. They are not the same thing. Technology companies exist as investment vehicles for R&D. There are endless streams of projects when your whole existence is structured around finding endless streams of projects.

suzzer992• 3 months ago

Yeah it feels like a lot of this could still be shakeout from FAANG and FAANG wannabes hiring 10x more engineers than needed. I realize Square is a more complicated business than OnlyFans. But OnlyFans isn't a trivial app and it runs on 42 employees. Block had more than 10k employees pre-layoff.

lux-lux-lux• 3 months ago

42 employees and a legion of contractors.

jmuguy• 3 months ago

You'd think if the market were rational that Block would be punished for firing that many people, and obviously lying about why, but we haven't reached that point yet I guess.

mcmcmc• 3 months ago

We still haven’t fully corrected from ZIRP either

agentultra• 3 months ago

I don’t think that sufficiently explains it either. We all want a nice little bow on a simple, easy target. But there isn’t one.

Block, for example, said that they had experienced record profits… in spite of their, “hiring spree.”

This is just capitalism working as usual, only more of it, faster.

AI has a part in it. So does austerity policies and the rise of a certain political climate.

jarjoura2• 3 months ago

No, this is 100% AI this time.

These companies need liquid cash to invest in AI infrastructure, and so they're doing mass layoffs to give them the capital to invest. Simple as that.

2022-2024 was COVID reset. 2025-2027? is reallocation of spending from R&D to infrastructure.

rvz2• 3 months ago

When anyone asks the question: "What is AGI", it is actually this. An "abundance" of nothing else but this.

It's just that the tech workers are the canaries in the coal mines for the other white collar knowledge workers.

This is "AGI".

i_love_retros2• 3 months ago

Meanwhile... I had to step in and hand code lots of css today because copilot couldn't do the thing. And I had to step in and manually fix tests yesterday because copilot couldn't do the thing.

Are you paid by OpenAI and/or Anthropic?

gbnwl• 3 months ago

Have you considered not using copilot and using Claude Code or Codex directly?

rvz2• 3 months ago

Are you paid by OpenAI and/or Anthropic?

No. The VCs and angel investors screaming “abundance” are the paid promoters.

The problem is their “utopia of abundance” is not for us. They know the opposite is the reality (layoffs, offshoring, wage suppression and AI backlash)

They built their own bunkers and moats for a reason. Because true “AGI” will bring an abundance of very angry people going after them.

That is not worth being paid for by any AI lab.

AlBugdy• 3 months ago

Can anyone provide historical data for "job busts" or other types of declines in tech employment, massive layoffs or hire freezes? I seem to read about something like this every few years. Would like some data to see if this trend is stronger than the previous ones or not.

mr_00ff00• 3 months ago

Layoffs.fyi maybe? Not sure if that’s the data you are asking for

menzoic• 3 months ago

I just put your question into GPT-5 Pro

ethan_smith• 3 months ago

The big ones: dot-com bust (2001-2003) saw ~560k tech jobs lost per BLS, took until roughly 2007 to recover. 2008 financial crisis hit tech less hard but still significant layoffs. Then 2022-2023 saw ~260k+ layoffs tracked by layoffs.fyi, mostly at companies that had massively overhired during the ZIRP/COVID era. The current cycle feels like a continuation of that 2022-2023 correction more than a new event - hiring never really bounced back the way it did after previous downturns.

jcranmer• 3 months ago

Here's some historical data for employment in category NAICS 5415: https://fred.stlouisfed.org/series/IPUMN5415W200000000. Which, NAICS 5415 definitely isn't a complete picture of tech employment, but it should give rough correlation I would hope.

omgJustTest• 3 months ago

reciprocal tariffs had put the non-tech and tech economy in stasis (except for hardware for AI). they are also are better than tax breaks and will supercharge bottom lines for large corporations once reclaimed and if prices remain high.

also if you want to test/force ai adoption you have to put pressure by firing some

now wars will put us into further stasis or decline via increased inflation pressure.

cheschire• 3 months ago

Without an archive link I think 90% of these comments will be in response to the title only.

ilc• 3 months ago

It's dead Jim.

bookofjoe2• 3 months ago

I'd happily provide one but I've had enough of being repeatedly trashed and denigrated here for posting too many archive links.

gerdesj2• 3 months ago

You could look at your denigrators and decide: "fuck you". Internet points are strangely attractive but not vital. You can always post with another account with a bit of effort too.

I understand that you are pissed off (as am I too) but debating with an army of bots, LLMs, wankers and Russians is unfortunately the status quo, quotidien.

On the bright side there are lots of lovely folk hereabouts with a large thing between their ears.

Uhhrrr• 3 months ago

I have only ever gotten thanks and net positive points for posting archive links.

slg2• 3 months ago

It is interesting that sites like HN have existed for decades and still don't have any real solution for this sort of problem. Is providing a way for us to all bypass paying for this content that cost money to produce actually the most desirable outcome?

Like imagine if there was some 90 minute tech documentary on Netflix that was worth discussing here. Could I just rip it and link to a copy on my Google Drive? How long would that link stay up? I can't imagine long. I guess the conclusion based off how these sites operate is that piracy doesn't count when it's just words.

layer82• 3 months ago

Looking at your karma, I think you can afford it. ;)

tootie• 3 months ago

Gift link: https://www.economist.com/finance-and-economics/2026/04/13/t...

porphyra• 3 months ago

It doesn't work.

You’ve just missed out—free access to this article has expired. Register to view

dragonfax• 3 months ago

Given that it's paywall, there's a good reason for that. (gift link below no longer works)

didgetmaster• 3 months ago

Posts with links to paywalled articles should be identified somehow. (Flashing red title??)

I would prefer to just skip them, but they are not easy to spot.

onel• 3 months ago

Gift link

https://www.economist.com/finance-and-economics/2026/04/13/t...

mchusma• 3 months ago

developer jobs are up: postings ~11% YoY, tech workforce +1.9% projected for 2026, BLS 15% long-term growth. Rebound from 2024-25 lows

Jevons paradox

JoRyGu• 3 months ago

Maybe a case of really high profile companies doing RIFs while medium and smaller companies keep hiring?

calepayson• 3 months ago

I think a big part is that the hiring market for juniors feels apocalyptic rn. Jobs may be up in aggregate but that doesn’t necessarily mean everyone’s feeling it equally.

MeetingsBrowser2• 3 months ago

Job postings are not jobs. A company can layoff 10k and post jobs for 1k and have job postings be up.

Projections are useless. The past does not predict the future.

BLS is useless for the same reason, amplified.

bootsmann• 3 months ago

Maybe if you’re at the point where you dismiss three datapoints that all disagree with your thesis without any real argument you should rethink your thesis.

dnnddidiej3• 3 months ago

Reversion to the mean?

h4kunamata• 3 months ago

It is the perfect storm, companies overhired during covid by a 1000%

Then covid went away, life went back to "normal", tons of juniors everywhere who moved to IT because of WFH and the salary.

Then comes AI, within the IT field, I am seeing first hand companies firing by the thousands because of AI.

Only Blue collar was being affected in the past, but now is everybody, no matter of your degree, experience, you either already had a hard time or you will have.

If Google Quantum computing somehow finds a massive breakthrough, we are all fu :)

jmyeet3• 3 months ago

So I want to talk about the Claude Mythos mega-model that had a real marketing push in the last week. Marcus Hutchins (of IWannaCry fame) posted about the economics of this [1].

The upshot here is this was a longstanding BSD bug but mostly because nobody is paying BSD bug bounties and a null-pointer dereference may induce a crash but rarely (if ever) leads to privilege escalation as buffer overflows generally do so isn't as high-priority. The estimate on the cost is $20-50k of tokens.

$50k gets you a lot of developer time, upwards of 2 months. As has been stated in a bunch of threads, much smaller models could also find this bug. The defense is "they didn't" and "once you know it's there, it's easier to find" but again, nobody has been paying BSD bug bounties. Put another way: far fewer people have been looking.

My point is that the economics of these models are still highly debatable. What they will do is allow you to use 1 engineer with AI tools instead of 2-4 engineers.

And we've arrived at the real goal here: to reduce head counts. Why? To suppress labor costs. To get people who didn't get laid off to do more free work.

In addition, AI capex is used as an excuse to cut costs ie reduce labor, for exactly the same reasons.

Lastly, the threat of this happening in the near to medium future is also used to scare labor and reduce costs.

Sufficiently largecompanies can't grow anymore. Their only path forward is to raise prices and redcue costs. For tech companies, labor is a significant cost. That's what's going on here.

[1] https://www.tiktok.com/@itsmarcushutchins/video/762774007353...

xdennis• 3 months ago

$50k gets you a lot of developer time, upwards of 2 months.

God, I wish I was American sometimes...

yoyohello13• 3 months ago

Right up until you lose that job and get sick.

jmyeet3• 3 months ago

You have to consider all the costs of employing someone, not just the direct compensation. Benefits, health insurance, taxes (eg employer payroll taxes), office space, equipment, various insurances, utilities, costs related to just having that person (eg HR) and so on. So even a $100k salary, which is pretty modest for a US-based engineer, the additional costs may well add another $50-100k.

ianm2182• 3 months ago

You’re missing the cost curve of inference. What costs $20-50k now will cost 2-5k in a year or two at which point the math is a no brainer. It makes a lot of sense to build products that almost work now or are almost economical and ride the trend line.

ehnto• 3 months ago

Why would it reduce ten fold? I think performance of the chips gets a little better but not that much better. The cost of the infra is probably going to go up if energy costs keep going up and presuming the US can keep getting cheap chips.

jopsen• 3 months ago

What they will do is allow you to use 1 engineer with AI tools instead of 2-4 engineers.

Stop there. The costs of today state-of-the-art hype-ware will be lower tomorrow.

In a year, there will be fewer easy to find bug, and models like this will be cheaper.

Doing math based on hardware deployed today is a bit naive.

Assuming any of this is intentional about reducing devs is just dumb.

varispeed3• 3 months ago

Problem with these models is that they are not reliable. You never know when the provider decides to nerf the model and after good week of making progress you find the model is now running in circles and you are burning tokens like you are operating a steam locomotive and standing still.

jmyeet3• 3 months ago

Tbf people aren't reliable either. Not that I'm defending the AI models but remember these long-standing bugs were introduced by people and not found by people for years.

Anytime anyone feels insecure that AI will genuinely do their job, I point them to creators like this [1]. Also, I find it so wild there are people, even here on HN, who don't admit that LLMs hallucinate, lie and forget.

I would have a hard time trusting any critical code produced by an LLM. This was a frequent complaint with OpenClaw (being Vibe coded) and the general advice was to not run it on any computer you're logged onto as you'll get hit by prompt injection attacks and the like.

Anyway, the models don't need to be reliable. They just need to be an excuse to fire people to suppress labor costs. That's the true use case.

[1] https://www.tiktok.com/@huskistaken

zeroonetwothree• 3 months ago

What they will do is allow you to use 1 engineer with AI tools instead of 2-4 engineers.

In a competitive market this doesn’t work exactly that way because you will then lose to your competitor who has 2-4 engineer + AI.

cute_boi• 3 months ago

AI + Outsourcing is the major reason of tech job bust. But, I think politician won't care as they are here for corporation not for the people.

trgn• 3 months ago

politician won't care

they dont care because nobody has a real gut feel affinity for computer programmers or the work, the sort of feeling that is required to animate somebody to action. it's never been a profession with any esteem, and the field never professionalized in the past 60 years, which is a shame, because we now see the outcome.

shimman4• 3 months ago

Politicians would deeply care about a specialized highly paid workforce that was politically active, but what we have is mostly a do-nothing industry that has nearly 100% ceded to their corporate masters.

I mean look at what the coal mining industry is able to get and their numbers are quite small. There's more fast food workers at Wendy's than coal miners, but something tells me that Congress doesn't care about the baconator over rolling coal.

Start doing some advocacy work and this can easily change.

0xchamin• 3 months ago

One of my mentor at my company got redundant exactly a year ago. He is still looking for the next role. I really feel bad.

ghaff5• 3 months ago

Post dot-com, a LOT of people basically left the industry. They may have continued on in somewhat adjacent roles but people can only afford to keep looking for the sort of employment they had for so long.

matheusmoreira• 3 months ago

Where did they go?

varispeed3• 3 months ago

Another reason is that wages don't keep up with the cost of living. For instance in the UK it makes little sense to be in IT, unless it's something boring and typing React boilerplate feels easier than stacking shelves or running deliveries.

stego-tech2• 3 months ago

Would really appreciate an archive link to read this, even though it appears to be another meta-analysis wrapped in a “everything will be fine” narrative from the limited previews I’ve been able to gleam and The Economist’s general lean.

The problem with the tech layoffs is that it’s poisoning the well downstream. Smaller employers have repeatedly cited their layoffs as justification for abysmal, unlivable salaries, and demanding those of us looking for work suck it up and deal with it while they search for bottom-dollar unicorns.

AI isn’t replacing the IT crowd outside of the expected junior roles, and even that’s starting to rebound as executives realize Juniors were how they got “white glove service” for themselves - a Senior Engineer isn’t going to wipe their ass for them, job market or not, because said Engineer’s time is infinitely better spent on literally anything else.

One other thing I’ll note is that the layoffs also seem to be remnants of the Brogrammer hustle culture: tech folks were enjoying more time for themselves to grow or live life outside of work specifically thanks to a few good years of paying down technical debt with properly-staffed teams, but the grifters up top see anything less than a 9-9-6 as somehow stealing from the employer and slash accordingly. The remnants are expected to do more work for less pay, with AI tools somehow filling the gap (even though these same employers often don’t want to pay for proper tooling to maximize use of AI).

This is definitely an industry downturn as those who stand to gain maximize their immediate returns. From the perspective of the C-Suite and Boards, the safest (albeit unethical) move is to betray: if AI is a bust, they’ll have made their wealth and can fuck off; if AI eliminates jobs and work, they believe their wealth will protect them in the future dystopia of their own creation.

It’s in that context (“fuck you got mine”) that the broader narrative fits with the myriad of puzzle pieces out there (higher interest rates, stock pumps, circular financing, tariffs, aging population, AI, etc).

kindawinda• 3 months ago

Would really appreciate if you made an archive link and sharing instead of complaining

stego-tech2• 3 months ago

Says the person who came here specifically to complain instead of doing it themselves.

For the record, I tried, but the archive site only had the preview cached; I suspect it’s looking for a URL identifier to bypass the paywall that I lack access to, but I can’t confirm either way from a mobile device.

mikert895• 3 months ago

Two big tech FAANG jobs, org is 95% h1b engineers from china/india. Tons of resumes from american grads somehow never hit my desk, continue to interview random candidates from india with some low quality USA masters from missisipi state. Candidate has spent the last year locked in a room memorizing algorithm interview questions

Madmallard2• 3 months ago

Why are we letting tech companies in the USA do this?

mikert895• 3 months ago

honestly i have no idea, in some cases, they are working weekends/are hyper focused on extremely boring, somewhat manual work. some of the systems are complicated and break constantly, so they are almost just oncall fodder for manually fixing a constantly breaking high scale service

ang_cire2• 3 months ago

Because we live in a techno-oligarchy now? Because the leaders of the top tech companies (by revenue) literally sat behind the President at his inauguration?

Because they can afford to buy the 'right' to do what they want, and you can't, and what they want is cheaper labor who they have more control over, and H1B workers will never rock the boat because the visa is a sword hanging over their heads.

Downvote all you want, it's the truth.

layer82• 3 months ago

It’s arguably consistent with the past: https://www.gilderlehrman.org/history-resources/essays/histo...

raincole• 3 months ago

To do what, attract talents from the rest of the world?

lateforwork8• 3 months ago

Because if we didn't we wouldn't have a tech industry?

The main problem with immigrant talent in computer field is that legislators don't understand the difference between IT and Tech product development jobs. IT jobs don't need immigrant talent, so companies like Accenture, Infosys etc. should not be given H-1B visas. But tech companies like Google, Meta, Apple, OpenAI etc. absolutely need immigrant talent, or they will lose to Chinese competitors.

Spooky233• 3 months ago

It generates economic activity and taxes in the US and suppresses wages.

Most of the H1 candidates are in shitty roles that are well defined low/moderate skill jobs for giant companies. Hire people whom you can’t actively exploit and those are the kind of jobs where unions can organize.

The alternative is offshoring the work, not hiring Americans.

The smart thing would be to just let people immigrate. Instead we have a weird tiered system with a small number of highly skilled specialists and an army of serfs facing deportation if they piss off the bosses.

bigyabai• 3 months ago

Why would we stop them? Labor is a free market.

throwaway4224322• 3 months ago

It's not just the USA, all Western countries are on a path of mass immigration: software, engineering and health services in particular.

A big factor has been diversity quotas to make organisations DSG numbers meet the requirements of institutional investors, political pressure and activists.

Problem is: pushing diversity into traditional male roles didn't result in boys diversifying into non-traditional roles such as nursing and teaching, and now you have those other roles being filled with immigrants to make up for the shortfall. And those immigrants don't care for diversity.

seanmcdirmid2• 3 months ago

I’ve seen two interns through to FTE jobs at a FAANG, both were at least second generation immigrants (so citizens I guess, though I never asked). So kids are still getting jobs, they come from reasonable universities, I haven’t seen UW resumes yet (my Alma mater), for some reasons those kids are all scooped up before I can take a look (I work at an office in Seattle so I find it weird that we can hire from the local university).

mikert895• 3 months ago

the weird thing is seeing american kids from a top 20 american school (duke, carnegie melon, etc) mixed with a much larger majority of h1bs from absolute no name schools. its almost like the bar for americans is higher

throwaway4224322• 3 months ago

I think the issue could also be this:

- Tech or engineering company hires foreign resident engineer.

- That engineer works their way up in the company to a position where they are in control of hiring.

- They hire more people like them.

We used to accuse start-ups for hiring for cultural fit (people like them) which looked like sexism and ageism. Same thing, different group.

pojzon• 3 months ago

One rabin says “preference” another says “discrimination”.

At this point everyone should know “cultural fit” is synonymous to “preference”/“discrimination”.

tennisflyi2• 3 months ago

Yup. ATS has always been a problem. Even worse with AI

clapthewind• 3 months ago

DSA itself may now not be as indicative, but grinding is absolutely a key trait in good hires. That type of person will put in very effort at work.

ang_cire2• 3 months ago

I think a lot of people don't see the historical trend of where investment moves around. The 90s dot-com era was driven by massive investment in e-commerce (remember that term?) businesses. It created a bubble, which then burst.

When bubbles burst, investors change tack, and when investors pull back, companies turtle and do layoffs.

After Y2K, investment moved on to real estate. In 2008, that bubble burst. It moved on to social media next.

I would argue that bubble burst somewhat silently during COVID with the quiet deaths of Xitter and Facebook (from a standpoint of cultural relevance), and investment transitioned towards and into its current AI bubble.

Investors are always going to move on once the lustre of a field has waned, and I'd hazard that we'll see investment move somewhere other than software tech next (if I had to prognosticate, I'd say it's moving into robotics/ drones).

ikr6782• 3 months ago

If inflation kicks off, it will go back into physical assets.

qwertyuiop_2• 3 months ago

Nothing happens in a vacuum. "Tech companies" act in a coordinated fashion despite claiming they don't. Remote work was great until it wasn't. This is a coordinated action to shed all the mass gathered during ZIRP. Market forces is one naive explanation. But as history has shown factors extraneous to market forces are at work. This period will be written about, analyzed and diced in thousand different ways by future "thought leaders".

throwaway133373• 3 months ago

Software devs lost their pricing power due to LLMs but not exactly how most people think.

What's missed in understanding is 'how exactly does this functionality work for this specific case?' or 'can we implement this tiny one off feature in some legacy code base'. Both things are why you keep the guy that wrote it around. And you couldn't really replace him. Because digging into what he wrote was hard.

Now, LLMs can do that stuff better than the guy that wrote it.

Software devs were non-fungible. Now they're commodities. When things become commodities, they lose their value.

I'm not sure why I haven't heard people talk about this aspect. It's the biggest effect on jobs.

sebmellen3• 3 months ago

While this is true to an extent, oftentimes the important context is not in the code but in the head of the writer. The code is just the fence in the Chesterton’s Fence analogy. And that is still non-fungible and will (presumably) forever be.

There exists in such a case a certain institution or law; let us say, for the sake of simplicity, a fence or gate erected across a road. The more modern type of reformer goes gaily up to it and says, “I don’t see the use of this; let us clear it away.” To which the more intelligent type of reformer will do well to answer: “If you don’t see the use of it, I certainly won’t let you clear it away. Go away and think. Then, when you can come back and tell me that you do see the use of it, I may allow you to destroy it.”

throwaway133373• 3 months ago

You're correct that it doesn't answer the why.

But it answers the what, how, and allows one-off features.

So the guy that wrote might (or might not) still have the edge with the why. But that's not the moat it used to be.

qwertyuiop_2• 3 months ago

I am yet to see this pan out in the enterprise. Enterprises are full of mini kingdoms built by VP+ leaders with the tools they prefer or were sold on. And many of these tools are inherently and sometimes by design are cumbersome, expansive and not onboarding friendly. LLMs haven't breached this domain and this domain empirically is 80% of enterprise software. I am yet to see direct examples of llm agents replacing say 4 engineers out of an existing 8 person team.

dnnddidiej3• 3 months ago

Software devs were always fungible up to p99.9

mmmpetrichor• 3 months ago

I work for a fairly big tech company, For the last 2 years, basically stopped hiring people in the US. Only hiring engineers in the India office.

atduran• 3 months ago

corps do that to make stocks go up, once the quarter ends, they start hiring again

1vuio0pswjnm7• 3 months ago

"America’s Census Bureau estimates that just 28% of firms in the San Francisco metropolitan area use AI regularly as part of their day-to-day operations. In America as a whole, adoption is much lower."

zombot• 3 months ago

Don't blame AI

Some may blame AI, but the opposite is also true: The believers use the bust as "proof" that AI coding "works".

The tech jobs bust is real. Don't blame AI (yet)

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