The financial and business press always invents causes to try to explain current events. Like you'll see an article that states "stocks fell today due to profit taking". In reality journalists have no clue why it happened and just make up something that sounds plausible or at least isn't objectively false.
This probably depends on how you define "IT". I think for employment type stats the list of categories is fairly wide, and can include almost anything that requires a computer that doesn't fit into other categories (which btw is often used for 'exempt' overtime status to put people in on-call rotations without resulting in an 'engaged to wait' scenario that requires payment for time not spent on a call. because they're "experts in IT related field").
But specifically this is probably mostly driven so far by tech support industries. "IT" being customer service reps who use a computer to respond to chat messages, in some cases.
Or actual tech support that's had its entire entry system stripped and replaced by an AI-guided walkthrough of predefined steps customers are required to take before they talk to a human. This will certainly have impact on the amount of support staff needed, even if a portion of that is simply frustrating customers into searching for answers themselves.
According to the article, the overall unemployment rate is 4%. So something is happening with IT jobs, not the economy. I call it bullshit that it's the AI, it's the outsourcing/remote jobs
I think it could be related. We purchased AI tools - with the new expectation - baked into weekly sprint deadlines that we will get 30% more work done.
You would need to wait for several quarters' worth of labor market data and a thorough empirical analysis to see whether the hypothesis held up. 2-3 years would need to pass just to collect enough data.
"Another reason for January’s tech job losses was that companies began implementing some intended spending cuts for this year, Janulaitis said, and many slashed budgets based on what the economy looked like during fiscal planning last year."
Exactly. Seems more likely that it's driven but much higher interest rates than AI. AI is likely just how these businesses are trying to justify why/how they've laid off more workers instead of asking the remaining people to do a lot more work for the same pay.
they think it is 'due to AI' because it helps push tech stocks; not due to any facts. I also recommend looking at this article's source (https://e-janco.com/career/employmentdata.html?srsltid=AfmBO...), apparently the Janco guys think its going to be be a better year for tech than last year. Trash journalism....
We don't. Economics is complex and it is extremely common for journalists to simply take something and run with it. Even just saying "unemployment" needs scrutiny, as there are multiple ways to measure "unemployment."
> How do we know that the rise in unemployment is being driven by AI specifically, and not by wider economic circumstances?.
There are several important things to look at that show this. First and foremost, IT has about a 40 year history now, with corresponding economic data.
In its entire history, its been uncorrelated with interest rates and other assets. These correlated assets are what most people refer to when they speak of wider economic circumstance. The IT industry is uncorrelated with this, with 40 years to back that up.
IT labor markets are however strongly correlated with advances in information technology. This correlation is found throughout that dataset as well, in both the boom and bust cycles.
The deep unemployment which we are seeing here, which doesn't include the first batch of laid off employees two years ago [18 mo], is only correlated and impacted by Information Technology advances.
There is only one such major advance that has been made in this time period... Artificial Intelligence.
AI has improved dramatically from a modular swappable design, and it can replace entry level positional tasks completely. It probably won't ever be able to take over the senior level positions, or the mid level positions, but that doesn't matter.
The companies involved in integrating these things into the production environment have mislead most of their customers, and in the process burnt all the bridges. Many of these companies market towards replacing workers with AI, grossly negligent of the whipsaw they are creating with that misleading narrative. In the short term they make lots of profit, while destroying the environment they need to sustain themselves.
By choking off the professional development pipeline which is a sequential pipeline in developing talent, this leaves few opportunities to progress to mid and senior level positions, which were few and far between to begin with.
When there is no economic incentive to go into any specialized field because AI has burnt the only bridge for a long-term career, people don't go into these jobs. Worse, those caught surprised by this change in circumstance, who actually have sufficient experience to perform at these mid-level ranges, may abandon the profession causing exponential brain drain. As anyone knows, people age and eventually die. Senior level people are at greater risk to this than others.
This inevitably creates a tsunami of cost in those irreplaceable positions which cannot be addressed by the market, and balloons far above what the market can bare. The forward looking expectations have made any labor in this industry worth less than AI services, and IT as a general rule is a labor multiplier where changes here eventually expand and infect everywhere.
Business is not constrained in hiring people because many business receive operations funding upfront from their financial engineering which often comes from money printers. By the time they notice the problem, it will be too late to solve it, in many respects its already too late because you have people who are incredibly competent, near geniuses, and they see no future in the industry and are retraining ahead of the curve.
AI threatens society because it disrupts the core pillars of society, which is indirect but immeasurably important to sustained organization of labor and food production. Agriculture is dependent on something like 64 different intermediate producers to maintain production levels sufficient to feed people.
Failures back to pre-modern industrial technology would mean half the people alive today starve to death, no matter how much they work.
These are the issues which the article doesn't really touch on correctly but its WSJ so what do you expect. Their journalism has never really been up to snuff.
I can confirm this. Former Senior Manager from Big Tech Co here (I just resigned 2 weeks ago). When I left, we were in the middle of offshoring all of my groups to Amsterdam. No stock compensation in Europe = cheaper devs. There was no real talk of replacing anyone with AI. We all used copilot and the other LLMs as tools, but you still needed devs who understood the systems and how to debug the generated code.
> They are replacing US jobs with jobs in Poland. I experienced this first hand.
Like, only now?! This had been the case my entire career to the point I got fed up of rat race to the delight of foreign superior, became cynical and unemployable. It's not ey-ay, nor outsourcing, it's the economay. We have a crisis, sir.
This was totally predictable. If your job can be shipped to Kansas from SV because it is cheaper, it won't be too long before it is shipped to Canada which cheaper than Kansas and then to Colombia.
But HN is still embracing remote work. I hope those in the US/Western Europe wake up soon otherwise all the coding jobs will go the way of manufacturing jobs very soon - either done by robots or done by cheaper labor in Asia or Africa or LatAm.
I haven’t experienced it, yet, but for my company it might be one of two ways it becomes profitable. The other way is to lay everyone off AND offshore work only when the lone remainer needs help.
If Putin gets what he really wants that is going to work out as great as it did for all the companies outsourcing to Ukraine.
Putin is covertly manipulating Poland with the same games as he did with Ukraine. And now it appears increasingly likely he has the right guy in the white house to take what he wants.
Another lackluster article with a number of assertions with AI in the headline to drive clicks.
From the article...
> "Jobs are being eliminated within the IT function which are routine and mundane, such as reporting, clerical administration,” Janulaitis said. “As they start looking at AI, they’re also looking at reducing the number of programmers, systems designers, hoping that AI is going to be able to provide them some value and have a good rate of return.”
Hoping... - I think this is where "leaders" are showcasing their ignorance. They're being sold a bill of goods that, truly, doesn't exist at the levels they think it does.
Now, on the flip side, the first part of the paragraph above seems plausible. However, these mundane tasks have been able to have been automated for a long time. It's just that it wasn't en vogue.
Reducing the roles outlined will truly lead to shittier outcomes for these companies and I hope the ones that are diving head first end up paying the price as it showcases, not their efficiencies but their ignorance.
AI has a few great use cases. Replacing IT folks who are skilled and can think on their feet are not a prime target for AI.
I doubt AI has much to do with it. But it may be given as "excuse" by CXOs to explain why the cuts have been made.
To add AI functionality, you will first need more developers, and a different kind (those that can train/evaluate/improve/deploy/integrate AI models) before potential savings can be kicking in. Some payback that may lead to layoffs could happen, but with a delay. It would be very silly to lay off a good developer rather than re-assign them, because the cost of hiring them is enormous, and you may not get the same quality again; in economic terminology, software engineers are "non-fungible resources".
jobs are leaving the US and going overseas. even h1b engineers here are treated like dogs because what are they going to do? complain and get sent home? no. they'll work weekends, and 12 hours days, sure.
and before you say this is false I've seen it firsthand many times. personally seen it with my eyes.
Having tried to get AI to do some of my coding work for me, I’m not convinced AI is the real culprit. I think this has much more to do with the end of ZIRP.
The irony is that AI, as a replacement for an even average programmer, doesn’t work. You can use it helpfully if you are already a programmer, but if you’re not, you won’t know when it’s generating insecure or even non-working code.
And yet it’s causing massive disruption. The bosses have such a hardon for layoffs that they’re doing this on the slim chance that it might work for them. Having to hire programmers back in a panic is, as they see it, future someone else’s problem.
I'm oversimplifying it horrendously with dumb math, but this is how I think of it:
Let's say you're trying to build a product/feature. You have general timelines for the launch. About 5 years ago, it would take a team of 10 to deliver it. Now, let's assume there were productivity gains, and you can deliver it with a team of 8.
This would not necessarily be a problem if for 20% of the workforce cut, you would also start getting investments and create 20% more companies/features. The big uncertainty is, will this ever happen, or it'll end up with 10% increment in such activities, so you still have that extra person hanging around.
That's absolutely true, but it doesn't mean AI won't lead to job losses just in terms of increased productivity: if your existing programmers can get more done you may find yourself reducing (or at least freezing) your team size.
I continue to hope that the net result of programmers getting more productive is an increase in demand for our skills, as employers realize they can get a whole lot more value for their investment. It might take a while for that to shake out though - we need companies to realize they can take on more ambitious projects now.
I realize that I'm beating a dead horse here but .. how can a story about two widely relevant topics -- the way AI is accelerating automation and the way that impacts employment all over the world -- be considered credible let worth sharing when it's based on someone just two (maybe three) sources -- from one employment agency when there are thousands in the US alone, and one analyst with just about zero footprint in the news sources I use or even come across?
No diss to the OP, but is there any point to sharing posts like this?
1) the headline is bait for a story content that's at best inconclusive,
2) of the two sources for this story, one analyst's point that IT spending on AI outpaced new hires seems to do most of the post's heavy lifting,
3) the second source -- an Indeed economist -- makes almost the opposite point that after increased spending on AI at the expense of new hires, spending on the is stabilizing
4) And this entire story appears to be based on *one month's worth of job reporting*
I understand why a WSJ reported is professionally required to spin something out of a nothingburger and convert attention into ad impressions and "provoke debate" or whatever, but for those of us uninterested in WSJ or Rupert Murdoch's success this feels as unhelpful as that post from a week or so ago about yet another (inconclusive A.F.) study on the effects of marijuanablahblahblah ...
[+] [-] arrowsmith|1 year ago|reply
The article's evidence for the AI claim is just "some guy you've never heard of says so".
[+] [-] nradov|1 year ago|reply
[+] [-] heroprotagonist|1 year ago|reply
But specifically this is probably mostly driven so far by tech support industries. "IT" being customer service reps who use a computer to respond to chat messages, in some cases.
Or actual tech support that's had its entire entry system stripped and replaced by an AI-guided walkthrough of predefined steps customers are required to take before they talk to a human. This will certainly have impact on the amount of support staff needed, even if a portion of that is simply frustrating customers into searching for answers themselves.
[+] [-] myth_drannon|1 year ago|reply
[+] [-] blueanon|1 year ago|reply
[+] [-] rchaud|1 year ago|reply
[+] [-] billywhizz|1 year ago|reply
"Another reason for January’s tech job losses was that companies began implementing some intended spending cuts for this year, Janulaitis said, and many slashed budgets based on what the economy looked like during fiscal planning last year."
[+] [-] pizlonator|1 year ago|reply
[+] [-] jarsin|1 year ago|reply
It works like this. Find whatever is hot that day, week or month then put it after the "as".
Stock market down as Trump holds another signing. Stock market up big as Musk slashes government spending.
[+] [-] sleight42|1 year ago|reply
[+] [-] anaccount342|1 year ago|reply
[+] [-] legohead|1 year ago|reply
[+] [-] wkat4242|1 year ago|reply
In our company we're not seeing any major impact on productivity yet and no jobs were lost. Yet.
[+] [-] trod1234|1 year ago|reply
There are several important things to look at that show this. First and foremost, IT has about a 40 year history now, with corresponding economic data.
In its entire history, its been uncorrelated with interest rates and other assets. These correlated assets are what most people refer to when they speak of wider economic circumstance. The IT industry is uncorrelated with this, with 40 years to back that up.
IT labor markets are however strongly correlated with advances in information technology. This correlation is found throughout that dataset as well, in both the boom and bust cycles.
The deep unemployment which we are seeing here, which doesn't include the first batch of laid off employees two years ago [18 mo], is only correlated and impacted by Information Technology advances.
There is only one such major advance that has been made in this time period... Artificial Intelligence.
AI has improved dramatically from a modular swappable design, and it can replace entry level positional tasks completely. It probably won't ever be able to take over the senior level positions, or the mid level positions, but that doesn't matter.
The companies involved in integrating these things into the production environment have mislead most of their customers, and in the process burnt all the bridges. Many of these companies market towards replacing workers with AI, grossly negligent of the whipsaw they are creating with that misleading narrative. In the short term they make lots of profit, while destroying the environment they need to sustain themselves.
By choking off the professional development pipeline which is a sequential pipeline in developing talent, this leaves few opportunities to progress to mid and senior level positions, which were few and far between to begin with.
When there is no economic incentive to go into any specialized field because AI has burnt the only bridge for a long-term career, people don't go into these jobs. Worse, those caught surprised by this change in circumstance, who actually have sufficient experience to perform at these mid-level ranges, may abandon the profession causing exponential brain drain. As anyone knows, people age and eventually die. Senior level people are at greater risk to this than others.
This inevitably creates a tsunami of cost in those irreplaceable positions which cannot be addressed by the market, and balloons far above what the market can bare. The forward looking expectations have made any labor in this industry worth less than AI services, and IT as a general rule is a labor multiplier where changes here eventually expand and infect everywhere.
Business is not constrained in hiring people because many business receive operations funding upfront from their financial engineering which often comes from money printers. By the time they notice the problem, it will be too late to solve it, in many respects its already too late because you have people who are incredibly competent, near geniuses, and they see no future in the industry and are retraining ahead of the curve.
AI threatens society because it disrupts the core pillars of society, which is indirect but immeasurably important to sustained organization of labor and food production. Agriculture is dependent on something like 64 different intermediate producers to maintain production levels sufficient to feed people.
Failures back to pre-modern industrial technology would mean half the people alive today starve to death, no matter how much they work.
These are the issues which the article doesn't really touch on correctly but its WSJ so what do you expect. Their journalism has never really been up to snuff.
[+] [-] hulitu|1 year ago|reply
It is right there, in the headline, sir. The economy is so good, like never before. /s
[+] [-] almosthere|1 year ago|reply
[+] [-] swimorsinka|1 year ago|reply
[+] [-] vitaflo|1 year ago|reply
[+] [-] whatever1|1 year ago|reply
[+] [-] lifestyleguru|1 year ago|reply
Like, only now?! This had been the case my entire career to the point I got fed up of rat race to the delight of foreign superior, became cynical and unemployable. It's not ey-ay, nor outsourcing, it's the economay. We have a crisis, sir.
[+] [-] ThrowawayJoe63|1 year ago|reply
Small org, no low-performers, no layoffs. Same result as everywhere else.
[+] [-] RestlessMind|1 year ago|reply
This was totally predictable. If your job can be shipped to Kansas from SV because it is cheaper, it won't be too long before it is shipped to Canada which cheaper than Kansas and then to Colombia.
But HN is still embracing remote work. I hope those in the US/Western Europe wake up soon otherwise all the coding jobs will go the way of manufacturing jobs very soon - either done by robots or done by cheaper labor in Asia or Africa or LatAm.
[+] [-] jkmcf|1 year ago|reply
[+] [-] nyarlathotep_|1 year ago|reply
[+] [-] jarsin|1 year ago|reply
Putin is covertly manipulating Poland with the same games as he did with Ukraine. And now it appears increasingly likely he has the right guy in the white house to take what he wants.
[+] [-] windexh8er|1 year ago|reply
From the article...
> "Jobs are being eliminated within the IT function which are routine and mundane, such as reporting, clerical administration,” Janulaitis said. “As they start looking at AI, they’re also looking at reducing the number of programmers, systems designers, hoping that AI is going to be able to provide them some value and have a good rate of return.”
Hoping... - I think this is where "leaders" are showcasing their ignorance. They're being sold a bill of goods that, truly, doesn't exist at the levels they think it does.
Now, on the flip side, the first part of the paragraph above seems plausible. However, these mundane tasks have been able to have been automated for a long time. It's just that it wasn't en vogue.
Reducing the roles outlined will truly lead to shittier outcomes for these companies and I hope the ones that are diving head first end up paying the price as it showcases, not their efficiencies but their ignorance.
AI has a few great use cases. Replacing IT folks who are skilled and can think on their feet are not a prime target for AI.
[+] [-] giancarlostoro|1 year ago|reply
[+] [-] exabrial|1 year ago|reply
[+] [-] jll29|1 year ago|reply
To add AI functionality, you will first need more developers, and a different kind (those that can train/evaluate/improve/deploy/integrate AI models) before potential savings can be kicking in. Some payback that may lead to layoffs could happen, but with a delay. It would be very silly to lay off a good developer rather than re-assign them, because the cost of hiring them is enormous, and you may not get the same quality again; in economic terminology, software engineers are "non-fungible resources".
[+] [-] giantg2|1 year ago|reply
[+] [-] whamlastxmas|1 year ago|reply
[+] [-] RomanPushkin|1 year ago|reply
[+] [-] Gothmog69|1 year ago|reply
[+] [-] sergiotapia|1 year ago|reply
and before you say this is false I've seen it firsthand many times. personally seen it with my eyes.
[+] [-] 65|1 year ago|reply
https://www.forbes.com/sites/jackkelly/2025/02/02/google-off...
https://www.forbes.com/sites/esatdedezade/2025/02/10/meta-jo...
[+] [-] yadaeno|1 year ago|reply
[+] [-] stalfosknight|1 year ago|reply
[+] [-] zusammen|1 year ago|reply
And yet it’s causing massive disruption. The bosses have such a hardon for layoffs that they’re doing this on the slim chance that it might work for them. Having to hire programmers back in a panic is, as they see it, future someone else’s problem.
[+] [-] tokioyoyo|1 year ago|reply
Let's say you're trying to build a product/feature. You have general timelines for the launch. About 5 years ago, it would take a team of 10 to deliver it. Now, let's assume there were productivity gains, and you can deliver it with a team of 8.
This would not necessarily be a problem if for 20% of the workforce cut, you would also start getting investments and create 20% more companies/features. The big uncertainty is, will this ever happen, or it'll end up with 10% increment in such activities, so you still have that extra person hanging around.
[+] [-] simonw|1 year ago|reply
I continue to hope that the net result of programmers getting more productive is an increase in demand for our skills, as employers realize they can get a whole lot more value for their investment. It might take a while for that to shake out though - we need companies to realize they can take on more ambitious projects now.
[+] [-] bigtex|1 year ago|reply
[+] [-] kmonsen|1 year ago|reply
[+] [-] fitsumbelay|1 year ago|reply
[+] [-] fitsumbelay|1 year ago|reply
1) the headline is bait for a story content that's at best inconclusive, 2) of the two sources for this story, one analyst's point that IT spending on AI outpaced new hires seems to do most of the post's heavy lifting, 3) the second source -- an Indeed economist -- makes almost the opposite point that after increased spending on AI at the expense of new hires, spending on the is stabilizing 4) And this entire story appears to be based on *one month's worth of job reporting*
I understand why a WSJ reported is professionally required to spin something out of a nothingburger and convert attention into ad impressions and "provoke debate" or whatever, but for those of us uninterested in WSJ or Rupert Murdoch's success this feels as unhelpful as that post from a week or so ago about yet another (inconclusive A.F.) study on the effects of marijuanablahblahblah ...
[+] [-] wyattshacker|1 year ago|reply
[+] [-] enrio2000|1 year ago|reply
[+] [-] unknown|1 year ago|reply
[deleted]
[+] [-] treebeard901|1 year ago|reply
[+] [-] belter|1 year ago|reply
[+] [-] pipeline_peak|1 year ago|reply