At least within my circle, that’s not really the case. Instead, what I’m seeing is more of a hiring freeze, with the budget being used to empower existing employees through AI. Which I think is a more reasonable take.
That's often layoffs in disguise. If you want to cut 10%, but you don't want to do it as a single layoff, because that's expensive, can trigger certain laws depending where you are, and might disrupt teams, who do you cut?
Instead you can do layoff by attrition, you stop hiring, and you don't backfill seats, as people naturally leave or get pip-ed, the team shrink, you don't rehire into the position, and in a year or two, you cut down by 10%.
Also, I wouldn't trivialize a freeze in hiring growth, it means to get a job you have to wait for someone to retire, and also wait for people looking for jobs with more experience as they're more likely to fill the roll to also retire. Basically there's now way more demand for jobs than hiring, so that will drive compensation down for those currently employed.
Adding on to your point about attrition: if internal promotions in engineering are decided by your ability to be a force multiplier, to facilitate cross team collaboration, mentor and help others to skill up, how do any currently employed engineers demonstrate that with no one new to mentor or train? How do you collaborate when teammates work with AI tools more and coworkers less? Would they just have an easier time getting into a higher responsibility role looking elsewhere?
as a solo: you can build and ship more in your own time
as a startup: you can iterate and scale more with more velocity and less growing pains
as an enterprise: people with ideas but not a technical background can put their tokens where their mouth is and build their own interfaces, personal apps, ask their own questions, ship their own features without having to navigate layer 8 and play games for resources
Why does it sound like layoffs? If you keep the team size the same and use the productivity increase to deliver more business value, how is that layoffs?
Thus layoffs, no need to keep as many employees around.
There is no MBA like magical growth, the amount of customers is a physical limitation of inhabitants on planet Earth that are willing to actually use a specific piece of software, regardless of how productive it was made in first place.
If I figure out a way to make my workers produce 10 times more widgets each, it doesn't automatically follow that there is a market for the extra 9 widgets. Otherwise I would have hired 9 extra workers before that invention to fulfill the market demand.
Making the widget cheaper doesn't necessarily create demand either. I will not buy 10 times more toothbrushes or writing pens if their prices suddenly decreased to 1 cent.
The demand for software or features will not increase at the speed of our ability to produce them.
That is the fallacy of all those MBA degrees with exponential growth expectations, they never take into account the physical limitations of goods, like your very good examples.
If every engineer is 10-100x more productive with AI, and one company slashes its workforce to maintain the same level of productivity at reduced cost, it will lose out to its competitor who retains the same workforce and does far more with it.
Right now, the vibe at my company is not “we can save so much money with AI” it’s “here’s an infinite budget, use all the tokens you can to expand our moat because we’ve never been more sensitive to competitive disruption than we are now”
At least within my circle, that’s not really the case. Instead, what I’m seeing is more of a hiring freeze, with the budget being used to empower existing employees through AI. Which I think is a more reasonable take.
That's often layoffs in disguise. If you want to cut 10%, but you don't want to do it as a single layoff, because that's expensive, can trigger certain laws depending where you are, and might disrupt teams, who do you cut?
Instead you can do layoff by attrition, you stop hiring, and you don't backfill seats, as people naturally leave or get pip-ed, the team shrink, you don't rehire into the position, and in a year or two, you cut down by 10%.
Also, I wouldn't trivialize a freeze in hiring growth, it means to get a job you have to wait for someone to retire, and also wait for people looking for jobs with more experience as they're more likely to fill the roll to also retire. Basically there's now way more demand for jobs than hiring, so that will drive compensation down for those currently employed.
Adding on to your point about attrition: if internal promotions in engineering are decided by your ability to be a force multiplier, to facilitate cross team collaboration, mentor and help others to skill up, how do any currently employed engineers demonstrate that with no one new to mentor or train? How do you collaborate when teammates work with AI tools more and coworkers less? Would they just have an easier time getting into a higher responsibility role looking elsewhere?
it sounds like leverage
as a solo: you can build and ship more in your own time
as a startup: you can iterate and scale more with more velocity and less growing pains
as an enterprise: people with ideas but not a technical background can put their tokens where their mouth is and build their own interfaces, personal apps, ask their own questions, ship their own features without having to navigate layer 8 and play games for resources
Why does it sound like layoffs? If you keep the team size the same and use the productivity increase to deliver more business value, how is that layoffs?
If you can get more done with less, your choices are either do more by spending the same, or spend less and get the same output.
Why do you think 100% of all companies will choose the first? Obviously some will choose the latter, hence it sounds like layoffs.
Because the limiting factor for what you can deliver has never been, and still isn’t, developer productivity.
Talking point: I think it is communication, and AI (notably information exchange in “Claudish”) is not as effective there.
with more productive teams you can have smaller teams and better communication
Thus layoffs, no need to keep as many employees around.
There is no MBA like magical growth, the amount of customers is a physical limitation of inhabitants on planet Earth that are willing to actually use a specific piece of software, regardless of how productive it was made in first place.
It’s layoffs if the demand doesn’t grow to meet the output
If I figure out a way to make my workers produce 10 times more widgets each, it doesn't automatically follow that there is a market for the extra 9 widgets. Otherwise I would have hired 9 extra workers before that invention to fulfill the market demand.
Making the widget cheaper doesn't necessarily create demand either. I will not buy 10 times more toothbrushes or writing pens if their prices suddenly decreased to 1 cent.
The demand for software or features will not increase at the speed of our ability to produce them.
That is the fallacy of all those MBA degrees with exponential growth expectations, they never take into account the physical limitations of goods, like your very good examples.
If every engineer is 10-100x more productive with AI, and one company slashes its workforce to maintain the same level of productivity at reduced cost, it will lose out to its competitor who retains the same workforce and does far more with it.
Right now, the vibe at my company is not “we can save so much money with AI” it’s “here’s an infinite budget, use all the tokens you can to expand our moat because we’ve never been more sensitive to competitive disruption than we are now”
Competitor won't retain the same workforce if the demand doesn't match the output.