Talking to friends in other places, and reading the article, it isn't really different elsewhere. Given the disarray the US government is in & their refusal to give us benefits we've already paid for, employers know they have all the power at this time.
If their goal is reducing wages through layoffs/attrition and lowballing new hires, they aren't going to get it without triggering a recession or worse.
I left tech for this reason.
Greed is sustainable.
When there's enough money on the sidelines, the pendulum swings, and big bets come back in fashion.
Downsizing is not a big bet.
Nobody leads tech to save billions and have money sit on the sidelines. It's a weak, shallow bet that should be reserved for discount retail and commodity markets.
The savings will be spent on engineering, eventually.
See: https://www.corumgroup.com/insights/major-tax-changes-us-sof...
https://technical.ly/startups/r-d-tax-change-reversal-startu...
[0] https://news.ycombinator.com/item?id=34617964
[1] https://www.livemint.com/companies/news/elon-musk-fired-80-p...
If Musk had never purchased Twitter and Jack Dorsey performed the same reduction in engineering staff, I doubt the site would be materially different from how it was pre-Musk.
The perceived success is not the same as actual success. Remember it is a private company and you don’t actually have any idea how bad the balance sheets were after the layoffs. Before the financial engineering that Musk did by using his other companies to invest in Twitter to preserve its valuation, the company was down almost 80%. [1] If public companies go down that route, they’ll very quickly find out what the actual impact of that model is.
[1] https://techcrunch.com/2024/09/29/fidelity-has-cut-xs-value-...
1. Large tech firms overhire like crazy
2. Interest rates go up, firms layoff tens of thousands of workers who never should have been hired in the first place
3. Firms pile more work on to remaining people, cut their pay relative to inflation
4. Existing workers threaten to leave, companies let them because "Look at all the talent on the market!"
It's abject lunacy, and companies are all too enthusiastically degrading the quality of their own workforces. The upshot is that this will pry some entrenched talent and experience out of large employers and into smaller companies. But the latest crop of MBA whiz kids are really something special.
Now we're in the worst case scenario- hundreds of thousands of middle-class "bullshit jobs" are disappearing, but rather than being replaced by a wave of productive jobs (say, in clean energy, non-polluting manufacturing, regenerative agriculture, medical technology, biotech, public transportation infrastructure, housing construction, etc) we're just seeing unemployment, underemployment and government policies that are openly hostile to anything helpful for society.
America could probably still be saved by a "Green New Deal" type of program which spurs massive investment and employment in industries which have positive externalities. Things don't exactly look like that's likely in the next few years, but maybe the 2024 election was the wake-up call the Democrats needed to reorient away from the "woke" social issues and reengage with the average American voter.
Jobs are neither fungible nor mutually exclusive; there is no reason to assume that someone working in a bullshit job would thrive in a non-bullshit job that contributes to society in more productive ways, nor does the existence of bullshit jobs prevent people from working non-bullshit jobs. I hate to say it, but perhaps many people are employed in bullshit jobs because they are not capable of anything more challenging.
Because bullshit jobs paid mode. Your average engineer working on ad targeting or at a hedge fund makes a lot more than working in say medicine.
— Flunkies, who serve to make their superiors feel important, e.g., receptionists, administrative assistants, door attendants, store greeters
— Goons, who act to harm or deceive others on behalf of their employer, or to prevent other goons from doing so, e.g., lobbyists, corporate lawyers, telemarketers, public relations specialists
— Duct tapers, who temporarily fix problems that could be fixed permanently, e.g., programmers repairing shoddy code, airline desk staff who calm passengers with lost luggage
— Box tickers, who create the appearance that something useful is being done when it is not, e.g., survey administrators, in-house magazine journalists, corporate compliance officers, academic administration
— Taskmasters, who create extra work for those who do not need it, e.g., middle management, leadership professionals
If it collapses, maybe AirBnB will still be able to rent out (illegally in many cases) apartments to rich foreigners from productive countries.
It is reasonable for companies to increasingly target that small part of population and sell them the same (small) number of widgets /services in higher prices and see their profits go up.
(Joke), well, if they keep convincing the small part of the population to spend ever increasing amount of money on "better" widgets...
In reality, if too many people are unemployed, no one's going to be able to buy things so that companies can have profits!
That being said, what I read is that a lot of companies are doing general housekeeping and trying to avoid bloat.
These incumbent companies are able to keep doing this because there’s no one around to eat their lunch. Maybe it’s cheaper to just buy (and kill) any company who legitimately threatens the status quo.
Companies should be hungry for real growth. You should not be able to financially engineer your way into stock growth.
And the lack of new (non-AI) startups allows bloated incumbents to get by without innovating or offering new products. Quality destroying measures like offshoring and outsourcing are easier to pull off. As is allowing services and standards to slide.
Maybe we'll only know once interest rates come back down. Or once the AI-replacing-workers veil has been lifted.
I think this dynamic is an under appreciated source of the chart that shows the decoupling of the job market with the stock market [1]
[1] https://www.businessinsider.com/how-scary-is-the-scariest-ch...
1. People being blocked on others
2. Lack of focus (Upper management ordering lower ICs to build bridges to nowhere, stop midway, start another bridge to nowhere project)
3. A lot of work being purely performative
4. A large chunk of REAL work having negative returns (management telling people to do stuff you'd be better off not doing financially)
5. ICs having slack.
AI doesn't need to do any of the real work. If it can increase efficiency ANYWHERE in this chain, it could have huge rewards.
Most people are focusing on getting AI to do REAL work.
But most "work" is waste or exceptionally low value, and I think more effort should go to AI reducing (instead of increasing) that.
paulsutter•2h ago
Starting over with a new org chart is the fastest path to higher productivity, but it should also work to gradually migrate to a more efficient structure by not hiring. Of course this could take many years and meanwhile you'll be outperformed by a smaller org.