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AI isn't replacing jobs. AI spending is
- laweijfmvo 11mo agowait until the GPUs and data centers start getting written off for being obsolete in a couple years when we still have nothin but fancy auto complete.
- FjordWarden 11mo agoImagine if you spent those years building something else.
- reeredfdfdf 11mo agoYes, like renewable energy infrastructure (which China does, and would be highly useful anyway in case generative AI does live up to its promise). Even if generative AI lives up to its hype, with current US administration there's no way America is going to lead the race for long. There's just not enough energy available, when those in power oppose developing many of the energy projects that make most economical sense.
- epicureanideal 11mo agoProbably could be repurposed for something else though?
- n3t 11mo agoYou can already buy cheap but powerful old servers. But newer hardware tends to be more power efficient. So, depending on time horizon you consider, it might be cheaper to buy newer hardware. Assuming that GPUs power efficiency will increase, the same will be true about them.
- laweijfmvo 11mo agowhat else could possibly use that much compute? especially somewhat specialized compute, not suited for general purpose compute?
- throw-52 11mo agoThe one truly hopeful aspect of a bubble-burst scenario is that extra capacity always finds a use-case, and in this case practically any other use-case would be both less harmful and more real.
- coaksford 11mo agoBefore the AI craze, all the GPUs were being bought up by cryptocurrency miners, and I'm not sure that's better. Even as an AI skeptic I think AI is a better use of all this hardware than cryptocurrency.
- throw-52 11mo agoYou're right of course, I'm taking for granted that we've been there and done that. The question is, would we do it again and would that usage really be allowed to expand to soak up whole data centers? We might since I don't think a cynic has made a bad prediction in years.. IMO the most likely way to soak up the extra capacity is actually yet another iteration of AI rather than say, doing productive but boring work with any other techniques for curing disease or something. Still, a crash and a next iteration might be more likely to involve fresh ideas on architecture, or focus on smaller expert models that have less fake results and actually empower users. Right now I think there's a clear bias in research and execution. OFANG does want results, but also wants results that tech giants. Are subsymbolic techniques really the best techniques, or are they just the best at preserving the moat of big-data and big-compute?
- mrweasel 11mo agoMining crypto if we're unfortunate.
- tryauuum 11mo agointeresting questions, how will this unroll right now I see even old GPUs like V100 are still popular. Maybe the old GPUs will shift to the countries with cheap electricity?
- xandrius 11mo agoI'd be glad to take any sweet obsolete enterprise HW off them.
- permalac 11mo agoElectricity bill would be huge. Great heaters tho
- dr_zoidberg 11mo agoA little bit off topic: but I couldn't even start to read the article because "I reached my article limit" out of I site I never visited before... What are they using to determine how many articles I've read? Opening in a private window solved the issue, however I'm pretty sure I don't regularly read anything on this site (maybe never was an overstatement?).
- finghin 11mo agoExact same experience here.
- deleted 11mo ago[deleted]
- lordgrenville 11mo agoSeems totally possible that the limit is 0...
- dr_zoidberg 11mo agoYes, the thought crossed my mind too... But then I tried a private window and it opened, so maybe the other suggestion that the cookies are very long lived is right.
- frm88 11mo agoI clean my cookies after every session online and had the same problem, so maybe the limit really is 0 but the dev never actually considered people using private windows? Like you could bypass NYT paywalled by disabling Java Script?
- likium 11mo agoNowadays platforms seem to track IP addresses and other signals to grant limits. Using a VPN works.
- system2 11mo ago
- deleted 11mo ago[deleted]
- goalieca 11mo agoI can't read the article but that won't stop me from commenting.. This year alone something like 400B was spent on investing in chips, datacenters, electricity buildouts. That's 400B that could have otherwise been invested in people. While i don't doubt that people will find a few solid business cases for LLMs, i am on team-bubble. I don't think this investment will add 400B worth of value and I very much doubt that this 400B is any good for future growth or long-term aspirations of AGI. Investing 400B into people and (tech) manufacturing would be a solid long-term bet with benefits.
- darth_avocado 11mo agoBah, all of that is still employing people. Companies have completed almost $1T of stock buybacks this year. Since 2018, with the exception of 2020, that number has been between $800B and $1T every single year. And that number has been more than $500B since the 2008 recession. AI spend is bad but it’s not even close to how much stock buybacks have ruined the employee wages and employment prospects.
- terminalshort 11mo agoYou think the companies are just going to give you the money if they don't do buybacks?
- darth_avocado 11mo agoNo but the point I was making was that AI investments at least generate jobs and allow money to flow to people, stock buybacks don’t even do that and are much bigger in magnitude.
- bigbadfeline 11mo ago> that AI investments at least generate jobs Nobody said they don't, but these are very few highly payed jobs dwarfed by the number of lost jobs due to capital misallocation. That's the point of the OP which for some reason got lost in discussions of unrelated issues like outsourcing. Besides, a lot of the AI investments go to Taiwan and other Asian countries where all of the AI hardware is made which makes non-AI hardware more expensive too - a huge cost on the economy. The recent Taiwanese factories in the US don't change that.
- lucaslazarus 11mo agoMatter of time until markets reckon with AI investment crowding out non-AI investment (cf. the massive oversubscription of Meta's latest bond offering). Must suck to be a small-cap firm squeezed by tariffs raising costs, unemployment lowering demand, and AI investment raising your own non-AI cost of borrowing.
- throwarchive 11mo agohttps://archive.is/9sdT5 https://archive.is/9sdT5
- pants2 11mo agoThat's an interesting point that I haven't considered before: that the narrative of AI replacing jobs plus the widespread cheating in school using LLMs is making students less engaged and new graduates less employable, becoming a self-fulfilling prophecy for AI.
- philipov 11mo agoThey told us TV would rot our brains, but AI actually does.
- andrei_says_ 11mo agoOr maybe TV also does and the baseline has already shifted into the state of that rot.
- _the_inflator 11mo agoNo one gets fired for tuning out of temporary tuning out of his smartphone or doing chores the classic way I guess. ;) I use mobile services timeboxed and in conjunction with blockers for certain services. I also went back to use old-school pencils and paper for work whenever possible. It is helpful - and fun. Blocking mobile internet on smartphones improves sustained attention, mental health, and subjective well-being: https://academic.oup.com/pnasnexus/article/4/2/pgaf017/8016017 https://academic.oup.com/pnasnexus/article/4/2/pgaf017/80160... Brain Drain: The Mere Presence of One’s Own Smartphone Reduces Available Cognitive Capacity: https://www.journals.uchicago.edu/doi/full/10.1086/691462 https://www.journals.uchicago.edu/doi/full/10.1086/691462
- MangoToupe 11mo agoSurely this would be indicated by a glut of unfilled job postings.
- a24j 11mo agoHere: https://www.npr.org/2025/11/02/nx-s1-5591302/ghost-jobs-are-everywhere-heres-how-to-avoid-falling-for-them https://www.npr.org/2025/11/02/nx-s1-5591302/ghost-jobs-are-...
- thunderbong 11mo agohttps://archive.is/9sdT5 https://archive.is/9sdT5
- _the_inflator 11mo agoI think the article is missing two points: if the latest layoffs aren't related to AI, then this doesn't mean AI won't have or has an impact on head count. And investment and experiments by definition include the risk of failing. In almost everything lies a survivorship bias and no one talks about the 100+ car makers that went into goldrush mode 100+ years ago. This is life. Netflix vs Blockbuster - already forgotten? Also the "fail rate" - so what part is failing and why? What's with the 5%? If we have a look at exponential functions this might be a really good deal, if the 5% can account for the losses. After all, benefits compound over time. I witnessed first hand in FAANG some quota hires and I believe that now that no one gets paid for contrived and artificial business advantages, we are back to a more merits based evaluation of workers. But AI should not be written off as fancy something with no impact. That's the wrong take. Whether it will be a springboard to new jobs that compensate for losses or replacements - I am not yet sure, but tent to be in the former group. ML engineers take care of ML - something new that takes care of something new. We will see.
- dahart 11mo agoIf Amazon’s layoffs aren’t AI driven, and AWS is making more money than it’s spending on AI infra… how is Amazon evidence of AI spending replacing jobs? This is an interesting topic, but this particular article left me pretty unsatisfied, it feels like juxtaposing a bunch of barely related numbers with some very popular talking points, but no new information? It hints at “AI washing” without doing any digging at all, and cites the MIT study without noting that it’s getting a ton of legitimate criticism. Is AI really a sideshow or an excuse for layoffs that big companies were hoping to do anyway, is it taking the blame for low confidence in the economy? https://www.futuriom.com/articles/news/why-we-dont-believe-mit-nandas-werid-ai-study/2025/08 https://www.futuriom.com/articles/news/why-we-dont-believe-m... https://www.cnbc.com/2025/11/04/white-collar-layoffs-ai-cost-cutting-tariffs.html https://www.cnbc.com/2025/11/04/white-collar-layoffs-ai-cost...
- diamond559 11mo agoAWS is making more money, they are not making money running llms. The companies didn't want to reveal internal procedures and exact profit/loss statements, is that surprising to this article writer? Sorry but MIT is more trust worthy than this stonk pumper site.
- dahart 11mo ago> Sorry but MIT is more trust worthy that this stock pumper site. Oh I totally agree with you, this was just the first thing that came up in a Google search. The criticism of MIT’s study has been going around widely, this site isn’t the only one saying that this study lacks objective metrics.
- davedx 11mo agoThe problem isn't with the MIT study itself -- it's with all the media framing of it as if "AI has failed", when the study was about pilots rapidly generating significant revenue.
- gravypod 11mo agoI don't necessarily believe this is the best explanation but: We know the economy is doing pretty poorly and tech companies are consolidating. Amazon is losing it's two main drivers of revenue: Irresponsible startups with huge AWS spend and no pressure to optimize their stack and consumers buying treats online. Regardless if people are spending on AI, the only thing businesses are investing on is AI and analysts at AWS are likely signaling that many AI companies are not seeing a large ROI and model developers will likely build their own versions of successful products (Claude Code). AWS doesn't want to scale up it's GPU fleet and be left holding the hardware bag. Amazon can't juice numbers for consumer purchases since the rest of the economy is contracting, most people are losing jobs, etc. So the easiest way to for Amazon to juice their metrics is to offshore office work that can be done anywhere. They can claim they are using AI - but from conversations with friends who are working at Amazon this does not sound very realistic - and ride the AI bubble with no liabilities.
- submeta 11mo agoThis does not reflect my reality. I have worked on half a dozen projects where we would have hired consultants to get the job done but have used coding agents to document, understand, migrate a project, create backend services, dashboards, and other things with budgets ranging from a few thousand euros to 200,000 euros. No consultants hired, nothing spent.
- diamond559 11mo agoWhat job did the llm do that was worth 200k Euro to you? Be extremely specific w/ hours worked etc bc we all totally believe you!
- foobar10000 11mo agoIn our case - agentic loop optimization of kernels. Works like a dream - after all, you have a perfect python spec (validation), the kernel is small (under 10 kloc), and the entire thing is testable. The trick is to have enough back test data so that things like cache behavior are taken into account. Ended up with different kernel versions for batch-back-test vs real-time work - which was interesting. 5 years ago would have hired about 10 ppl for the job - now 2.
- diamond559 11mo agoHow many man hours would it take 10 ppl to do this job?
- submeta 11mo agoIt was an innovation project, with an endowment of 200k. The task was to implement an llm based bot platform in a company with 700+ coworkers. After demoing MVPs, got 40k and access to experts I never needed to use. Deployed open source AWS solution, built customizations, landing pages, and data crawlers entirely solo using AI coding agents over ~3 months while working on other projects. Zero consultants, zero internal help. Would have easily burned the full 200k the traditional way.
- croes 11mo agoWhy not both? Given all those articles with AI generated images I bet that some artists lost their jobs
- system2 11mo agoI doubt. Good artists are still killing it. I see it on social media all the time. Also, corporations rarely care about the art as part of business. I don't remember the last time a tech company (or finance, wholesale, manufacturing, etc.) hired an artist. It is part of the job description of some managers, maybe, but who cares about someone with mediocre Photoshop skills?
- croes 11mo agoI‘m talking about stock image artists. Nothing you put in your resume but it helps paying the bills, like the singers of all those silly advertisement jingles. Those jobs get killed.
- system2 11mo agoThose jobs were already dead before Ai though. Oversaturated and controlled by major players like shutterstock.
- zer00eyz 11mo agoThis should shock no one. Over the last 20 years of tech, the giants have taken the smartest folks out there and put golden handcuffs on them. You could hire up all the smart folks and put them to work, or leave them out there and have them compete with you. With the launch of cloud providers and (expensive) dynamic scaling the problem only got worse. Think about hiring in the pandemic. Every one at home, with a stimulus check and nothing to do. Rather than a flurry of new software you got mass hiring. But now we are in a capital intensive hardware cycle. Where in order to compete you need to have lots of $$$$ as well as software know how. It does not matter that there are smart people out there, without hefty backing they wont get very far. I suspect that software is about to enter its "punk" era. We have software for small businesses that will help with accounting, HR, customer service, and cloud providers are starting to see some interesting competition. Much like the old punk poster showing you 3 chords and telling you to start a band it is entirely possible to find three friends and start a business that makes 1-10 mill a year with little effort and lower costs. The moment you stop thinking "unicorn" and start thinking "sustainable" the economics shift radically.
- gregates 11mo agoNot to mention that there's already a small market for software products that work just like existing products that were once good, only without all the AI getting in your way at every turn. You're just not going to be making huge enterprise sales with such a product (in 2025).
- vatsachak 11mo agoYeah with ChatGPT anyone with enough agency and programming chops can design tailored solutions for local businesses. I don't think that ChatGPT coding is valuable but rather it's ability to tutor people and guide them towards idiomatic patterns.
- EPWN3D 11mo agoI think you're on to something, but interest rates probably have to come down a bit more for it to really have legs. We definitely need a response to enshittification though.
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- Glyptodon 11mo agoAs a recently laid of senior engineer, to the extent that my job was replaced, it was replaced with offshore junior devs who'd already been working with the company for over year with a pretty rough level of productivity by man-hour, though maybe taking 3x the time to get things done is worth it if they're cheap enough. Which is to say I see my layoff as as cost cutting backed by a premise that there is no value in retaining senior level talent, to try and keep operating in the black, not because AI was materially producing a lot of benefits. (Because to the extent it was, I was the one reaping them compared to the offshore folks and less experienced onshore ones.)
- qwertyuiop_ 11mo agohttps://www.reddit.com/r/Layoffs/comments/1j3c5in/it_seems_that_american_airlines_is_offshoring_its/ https://www.reddit.com/r/Layoffs/comments/1j3c5in/it_seems_t... https://bloomberry.com/blog/amazons-layoffs-tell-half-the-story-the-data-tells-the-rest/ https://bloomberry.com/blog/amazons-layoffs-tell-half-the-st... https://www.theregister.com/2025/03/27/ibm_cuts_jobs_in_us/ https://www.theregister.com/2025/03/27/ibm_cuts_jobs_in_us/
- soneca 11mo agoI was told that the main reason the “Who is hiring?” thread (and other job boards for startups) has much fewer remote positions that are global (the vast majority is Remote US now) is because of a legislation that reduces a fiscal incentive when hiring software engineers and the reduction is much more aggressive when the engineers are from outside the US. Doesn’t it affect big tech companies? Only startups? I would guess the opposite, with big companies being much more savvy and influenced by fiscal incentives.
- diamond559 11mo agoActual Indians, as always. Humans are cheaper, and have the capacity for long term memory formation.
- random9749832 11mo ago
- exasperaited 11mo agoThis is absolutely crucial to understand. Because in any country with poor worker protections, the outcome is layoffs regardless. AI succeeds? Layoffs of unneeded roles. AI fails? Layoffs to cut expenditure to make up for the written-off expenditure. In the UK, if AI makes a well-established employee redundant, the employee is entitled to redundancy pay. And if the company fucks up and overspends on chasing a ridiculous Macguffin they can't just fire people without making them formally redundant. The damage that is going to be done in the USA if the AI bubble bursts is going to be generational.
- lisbbb 11mo agoIt already is. The US is currently missing an entire generation of journeyman tech workers because they never got hired in the first place. It's like when Cash for Clunkers got rid of so many used vehicles that it caused market distortions for years.
- hexbin010 11mo ago> they can't just fire people without making them formally redundant They are however pretty well trained in getting people to quit by making their job/life hell, avoiding all redundancy processes and cost
- exasperaited 11mo agoIt's hardly as if the USA is better. People murder each other over workplace problems there. But I guess if they want another tool to help make the workplace depressing, hellish, absurd and kafkaesque, congratulations everybody Microsoft just built it into Windows and Office365 and everything else.
- zero_shift 11mo agoSlightly tangential to the article: a lot of the "AI layoffs" are really just old fashioned layoffs, but with exciting press releases meant to reassure investors. AMZN for example overhired in various functions because it expected demand that never materialised. Admitting that is bad for the share price, but writing some woo about "AI and agility" will convince at least some investors to keep the faith.
- alecco 11mo agoThis week OpenAI, Google, And Perplexity announced free 1 year subscription to Indian devs. It must cost quite a fortune in inference https://www.bbc.co.uk/news/articles/c14pr0enjr6o https://www.bbc.co.uk/news/articles/c14pr0enjr6o Not a single mention of jobs being moved to India including tens of billions of investments in new offices. Backing links from a quick search earlier this week when an obviously Indian HNer tried to deny this was really happening: Microsoft announces US $3bn investment over two years in India https://news.microsoft.com/en-in/microsoft-announces-us-3bn-investment-over-two-years-in-india-cloud-and-ai-infrastructure-to-accelerate-adoption-of-ai-skilling-and-innovation/ https://news.microsoft.com/en-in/microsoft-announces-us-3bn-... (Jan 2025) Google announces $15B investment in AI hub in India https://apnews.com/article/google-artificial-intelligence-visakhapatnam-modi-pichai-ba8fd50e11e41bbdb72097dd10262283 https://apnews.com/article/google-artificial-intelligence-vi... (3 weeks ago) [Indian] ex-Accenture CTO named Google Cloud’s Chief Product https://www.hindustantimes.com/trending/us/who-is-karthik-narain-sundar-pichai-welcomes-ex-accenture-cto-as-google-cloud-s-chief-product-and-business-officer-101761020362017.html https://www.hindustantimes.com/trending/us/who-is-karthik-na... (last week) (a lot of people speculate they named an Indian Accenture guy to move as much as possible to India) Big Tech giants defy US-India trade tensions, record strongest 12-month headcount growth in India in 3 years https://www.moneycontrol.com/technology/big-tech-giants-defy-us-india-trade-tensions-record-strongest-12-month-headcount-growth-in-india-in-3-years-article-13506803.html https://www.moneycontrol.com/technology/big-tech-giants-defy... (September) https://www.reuters.com/world/india/openai-launch-first-india-office-new-delhi-this-year-2025-08-22/ https://www.reuters.com/world/india/openai-launch-first-indi... https://www.anthropic.com/news/expanding-global-operations-to-india https://www.anthropic.com/news/expanding-global-operations-t... and so on. Something very crazy is going on. NOTE: I am not American and this doesn't affect me directly.
- thedevilslawyer 11mo agoConfirmation bias, maybe? 15B is like 1.5% of a trillion dollars currently being invested in AI..
- manquer 11mo agoA lot of “AI” investment in countries like India is just annotation and labeling kind of work . It has so become huge there, that is getting to similar size as the traditional call centre industry, hundreds of thousand of people work on curating data for model training. Google hiring a senior lead who can scale low skill business processing massively is just inline with that. Any compute investment is largely local . Internet and Electricity is expensive and erratic, there is red tape, loads of import duties, there are dozens of cheaper places for cheap data centers. All this to say it is not the kind of outsourcing you think it is. —- There is a some amount of high tech outsourcing happening, those are driven by challenges in getting even a business visa in last 5 years. those numbers are quite small in aggregate won’t be news worthy. India simply does not have that kind of high quality talent pool . The education system is both expensive and very poor. There is shortage of qualified teachers, even bigger shortage of good ones. Students and parents just want to get a “degree” /maximize scores to get a job, There is little interest to learn.
- boulos 11mo agoThe article seems to hinge on the core assumption that revenue is much less than spending: > Those expenditures may be approaching $1 trillion for 2025, while AI revenue—which would be used to pay for the use of AI infrastructure to run the software—will not exceed $30 billion this year While it's clear that the author is summing up the spending from the big players, it's not clear to me that their math is right for revenue. Yes, OpenAI, Anthropic, Thinking Machines, SSI, etc. have pretty limited direct revenue (including zero!). But this comparison assumes no revenue growth for other top computing users. Some companies are certainly saving money on some tasks and increasing revenue, particularly in fields like customer support. See the confusing figure in section 5 of https://hai.stanford.edu/ai-index/2025-ai-index-report/economy https://hai.stanford.edu/ai-index/2025-ai-index-report/econo... . That chart is by number of respondents and not weighted by revenue. Like the MIT study, it would not be surprising that "just pipe this to an LLM" isn't enough for most fields or companies. But a few have likely made material improvements. 10% of respondents saying they've seen a >10% revenue gain could be substantial, if they're bigger firms with high leverage in computing. Edit to add: the comparison also makes a classic "GDP vs market cap" style mistake. Capital expenditure has multiple years of useful life. Revenue is annual. You'd want to compare depreciation vs revenue.
- DeathArrow 11mo agoMany are predicting the AI bubble will burst soon. Then we will see massive layoffs.
- shinycode 11mo agoMassive amounts of people with unsustainable lifestyle will stop consuming stuff. How will the whole capitalist economy continue to function with massive amounts of medium-high income people not having the same income anymore ?
- rvz 11mo agoIt's complete market failure. By the time the AI bubble bursts, those that have investments in those companies would have already exited. Then in 10 years time, they will look back at how they scammed the back off of the layoffs with AI driving the entire problem.
- lmm 11mo agoThe layoffs have already happened though. Companies are cutting massively even when it's supposedly good times. That's the story.
- howmayiannoyyou 11mo agoAI processing hardware deprecates (and depreciates) at a much faster rate than conventional CPUs, as much as 50% per year. Consider the billions being dumped into compute at that rate of depreciation and explain to me: 1. How will tangible assets generate profit net of near term capex requirements and interest on debt? 2. Why wouldn't payroll shrink as a result of the increased AI capabilities emerging from the capex spend? 3. If AI lives up to the hype & given recent news that public backstops are being requested, why shouldn't the US quasi-nationalize cash strapped players and distribute equity to every American? 4. As NVDA and AAPL local models and local compute eat into utility and base automation business, how do edge players maintain profitability without pricing capabilities well beyond the affordability of SMBs and individuals?
- zkmon 11mo agoSo, jobs are being replaced by AI spending (not by AI), and AI spending is increasing because of AI, which means AI is replacing the jobs. Did I get wrong?
- HarHarVeryFunny 11mo agoI suppose the distinction is worth making, since if it was actual AI replacing jobs, i.e. AI that is capable enough, today, to do someone's job, or more likely to increase someone's productivity so that headcount can be reduced, then that would seem a permanent shift and is only going to ratchet up. OTOH, if it is only dreams of AI, manifested as AI spending, or CEOs laying people off thinking that AI will soon (even if not today) be capable of backfilling them, then this may well backfire, and will be "reversed" if demand is less than forecasted and/or job-replacing AGI doesn't materialize, and all we get is productivity tools, useful mostly for a narrow band of jobs. Incidentally, I think Karpathy might be right that there is pretty much only one job that seems it actually could be replaced by AI today, at least potentially, which is call center tech support, or customer support, staff, who are dealing with a narrow domain and just reading off a script.
- zkmon 11mo agoSpending is happening only because, it promises to replace workers. And that possibility arises only because AI exists. Spending is only a means, not a cause.
- HarHarVeryFunny 11mo agoSure, but is the cause "AI" (here today, doing someone's job), or "promise of AI" (that may never materialize anytime soon, either in quantity or capability).
- rvz 11mo agocorrect
- phplovesong 11mo agoAbsolute garbage site. After all the popups it redirects to some general page. No sign of OPs arcticle.
- heywoods 11mo agoThis article gets the phenomenon right but the causation wrong: it's not "AI spending vs. AI replacing jobs". both are happening simultaneously, and they're causally linked. The spending-revenue gap is real. Hyperscalers are projected to spend $300-550B on AI infrastructure in 2025[1] while generative AI revenue won't exceed $30-40B [2]. Amazon's capex jumped from $48B in 2023 to $84B in 2024 to a projected $100B+ in 2025[3], that's capital intensity doubling from historical norms of 11-16% to over 22% [4]. But here's what the article misses: this isn't financial desperation. When Amazon's CEO announces 14,000 layoffs and explicitly states that AI will enable "fewer people doing some jobs"[5], he's revealing the strategic logic — show me the incentives and I'll show you the outcome. Companies aren't cutting jobs despite AI spending; they're cutting jobs because they know AI spending will pay off. To be clear, the article treats the spending-revenue gap as evidence of irrationality. But infrastructure buildouts always precede revenue: railroads looked insane before they transformed commerce, electricity grids consumed massive capital before delivering returns, the internet required enormous infrastructure investment before creating trillion-dollar companies. What's different now is companies are pulling the future forward. If we take this article at face value which I can appreciate is a BIG “if” then AI is already automating 25% of tasks and delivering 10-55% productivity gains[6] so they're not waiting for AI to replace jobs organically. They're cutting headcount now to fund the infrastructure that will make those cuts permanent. More broadly, this is rational capital reallocation in a winner-take-all race. Companies that don't build AI infrastructure won't gradually decline, they'll lose competitive positioning entirely. That's why Meta is using off-balance-sheet financing for a $27B data center[7], why Oracle is borrowing $25B annually despite already carrying 450% debt-to-equity [8]. They're all-in because the alternative is obsolescence. The real story isn't "spending causes cuts" it's that AI infrastructure commoditizes human expertise, the complement to compute infrastructure. Companies are trading labor costs for compute infrastructure because they've correctly identified compute as the new moat. The job cuts aren't the price of spending on AI; they're the business model shift that AI enables. The article is right that we're not seeing mass AI job replacement yet. But the job cuts are happening in anticipation of replacement, not as an unfortunate side effect of spending. That's not desperation just business strategy. -- 1.(Morgan Stanley: https://www.datacenterdynamics.com/en/news/morgan-stanley-hyperscaler-capex-to-reach-300bn-in-2025/ https://www.datacenterdynamics.com/en/news/morgan-stanley-hy...) 2. (Grand View Research: https://www.grandviewresearch.com/industry-analysis/generative-ai-market-report https://www.grandviewresearch.com/industry-analysis/generati...) 3. (CNBC: https://www.cnbc.com/2025/02/06/amazon-expects-to-spend-100-billion-on-capital-expenditures-in-2025.html https://www.cnbc.com/2025/02/06/amazon-expects-to-spend-100-...) 4. (Cerno Capital: https://cernocapital.com/accounting-for-ai-financial-accounting-issues-and-capital-deployment-in-the-hyperscaler-landscape https://cernocapital.com/accounting-for-ai-financial-account...) 5. (CNBC: https://www.cnbc.com/2025/10/28/amazon-layoffs-corporate-workers-ai.html https://www.cnbc.com/2025/10/28/amazon-layoffs-corporate-wor...) 6. (PwC: https://www.pwc.com/gx/en/issues/artificial-intelligence/ai-jobs-barometer.html https://www.pwc.com/gx/en/issues/artificial-intelligence/ai-...) 7. (Fortune: https://fortune.com/2025/10/31/metas-27-billion-bet-turns-ai-compute-into-wall-streets-hottest-new-investment/ https://fortune.com/2025/10/31/metas-27-billion-bet-turns-ai...) 8. (The Register: https://www.theregister.com/2025/09/29/oracle_ai_debt/ https://www.theregister.com/2025/09/29/oracle_ai_debt/)
- pjmlp 11mo agoI can tell that editors doing CMS translations, marketing images have certainly been replaced. Likewise many tasks I used to do with Java, .NET, Node.js, have been replaced by low code/no code tools with agentic orchestration. Thinking that AI isn't replacing jobs is wishful thinking.
- system2 11mo agoThose are tools, not jobs.
- jjk166 11mo agoThe combine harvester and the automated telephone switchboard were tools. If a tool allows for tasks to be done with much less labor, and the quantity of those tasks that need doing don't increase by a commensurate amount, then it does mean replaced jobs. The people replaced may move into new and perhaps even better jobs, either at different employers or transforming their current roll, but the job they once had is in lower demand.
- system2 11mo agoThat's the natural evolution of jobs, though. It is not like barbers will lose their jobs because of a new Cylon coming to market. These tools are gradually improving and adding more speed to workers. If someone's job is extremely mundane and limited, they have to evolve before these things take over. Those people can also lose their jobs when a new, smarter, and harder-working employee is hired and capable of doing what they are doing with a few clicks. This is the most common thing I see in companies. Boring employees get replaced by smarter ones every day. Better evolve or get eaten by the competition.
- pjmlp 11mo agoCapitalism mindset at its best, with the luxury of living in world regions where people find new jobs every day, and no family responsibilities. Many places of the globe the option is between mundane jobs or none at all.
- csullivannet 11mo agoIf AI really generates the value it claims to cutting jobs is short sighted. If existing human knowledge is commoditized, then we should be able to invest in generating new knowledge, and creating new kinds of products that were not even possible before.
- J_Shelby_J 11mo agoAnd if AI makes workers more efficient, then businesses not actively hiring more employees are admitting that even with extra resources they have no strategy to grow their business. Like, if one person is effective as ten people, then a business should be able to grow quicker since their operating costs are effectively lower freeing up capital for growth. So either their business is a dead end, the inefficiency is at the management layer, or AI isn’t actually making workers more efficient.
- jjk166 11mo ago> So either their business is a dead end, the inefficiency is at the management layer, or AI isn’t actually making workers more efficient. I'd bet on all three being generally true.
- throw234234234 11mo agoMost businesses have a limit to growth in general (e.g. market size, etc). Doesn't mean they are bad businesses just means they can't grow forever and there is a limit to the demand of that given activity. I argue this applies more so to tech products since they generally are relatively affordable already and for most people aren't price demand constrained. A dead end business w.r.t growth could be a cash positive asset for a very long time depending on what it does and maybe that's OK. Its why I'm not the biggest believer in "Jevon's Paradox" when it comes to software. Most software projects scale and as such they aren't really cost constrained. Or another way of stating this is "if the idea is good and can make lots of money the cost of dev's isn't a limiting factor" - hence why AI doesn't necessarily increase demand all that much. This is unlike say physical industries where cost can absolutely matter especially if the good is constrained already by affordability. I think most SWE's know this - they see it with outsourcing as well where cheaper costs don't necessarily mean more software is done; but there is some "hope" that things will be OK.
- gnarlouse 11mo agoMCMA: Make Class-warfare MAD Again
- rzwitserloot 11mo agoI read in multiple somewhat off-beat sources lacking good info (in the sense "They did not back up their writings and don't enjoy an impeccable track record of such high regard that I will take their word for it", not in the sense "its known untrustworthy drivel") that the hiring rates in the US in particular for 'junior developers' is way, waaaaaaaaaaay down. As in, off a cliff. I wonder if that's true; I'm not in the US myself so I can't exactly just go have a drink in a place with lots of devs to try to find out. The reasons are somewhat obvious: * World economy in general and the US in particular is a rollercoaster, with the current administration being apparently dead set on flip flopping on every decision it makes, and always making extreme decisions. That's not a good time to invest. Hiring juniors is investing. * AI not necessarily replacing the jobs, but that's not actually relevant: AI has already torpedoed the general notion that 'if you have investor money you gotta spend just hire a bunch of folks; # of employees is the primary yardstick to check company size / success', whether AI works or not. If the boss tells a VP to 'use more AI to get a handle on hiring practices', then they're going to stop hiring juniors because it looks like you're outright refusing a direct order if you hire a bunch. Even if AI 'employees' are useless, you are strongly incentivized not to hire juniors in such an environment. Juniors both lost the job opportunities stemming from companies just hiring folks because they have enough cash to do it and no good idea on where to spend it, and the downside of looking like you aren't on the AI hypetrain, if you hire juniors. * There's evidently been a rather massive push in particular during the previous administration to get folks from dead end jobs into IT, so there's now an overwhelming amount of junior devs, and many of them didn't naturally get drawn to the profession; they were told it's an easy way to get a steady job. * Even though there's some downturn/uncertainty, seniors/mediors aren't being fired because companies still remember how expensive and difficult it was to (re)hire dev teams post COVID. But that just makes the market for juniors even worse and makes it harder to hold out hope. When everybody is getting fired, then once the economy is in better shape you stand a good chance. But that's not happening; those mediors and seniors are continuing to get job experience whilst the juniors aren't. Those 4 combined: Sure, yeah, I can imagine your average junior dev's odds to get hired are at this point well into the single digits. But is that actually true?
- arisAlexis 11mo agoThere is incredible norlmancy bias lately and hopium. Yes it does and yes it will much much more. Preface all writings with "yet" if you will.
- osigurdson 11mo agoI'd say the biggest problem is AI complacency, something like: "in the future our revenues will be the same but won't need any people". So, in order to prepare for this future the obvious course of action to do some layoffs and just chill for a while. The problem is, we don't really know when this future will happen. If it is soon, maybe companies are making the right bet, if not it is more like a deliberate choice to slow down. That's fine if one or a few companies choose this path as competition will correct the error. However, if they essentially all move in unison competition won't fix the problem and we'll have a self-inflicted economic contraction for no reason. The other factor is, will revenues really stay the same for companies once we have AGI / super intelligence? It seems value will not accrue to the companies that are in chill mode.
- johnjames87 11mo agoEverytime automation replaced jobs the economies created by this replacement always created new jobs that replaced the previous ones. The USA has always been on the forefront of automating away jobs and it's unemployment rates show that new jobs were always created and that there was no long-term unemployment due to automation. AI won't be any different.
- throw234234234 11mo agoWe shall see. Most automations didn't automate the "controller/intelligence" part - they automated the actual task's labor (even if it was clicking for hours on a computer screen). Someone still needed to make all the decisions at every decision point. AI is fundamentally different if it approaches what AI proponents want; it surpasses human intelligence and has "agency/agentic". On a side note this is why I find proponents that state people with agency will thrive in the AI world puzzling -> isn't the whole point of "agentic AI" to have "agency"? With no advantage left (e.g. strength, intelligence, agency, etc) even if new industries come about why not use the AI for those too? Unlike previous industries where new domains needed more "brains" to drive/direct it, we have AI now. AI isn't a tool; it can for example deploy and can make decisions for itself. That's what the obsession with "agentic" is all about - replacing agency which at the moment was the very general domain that you still needed humans for. This strongly favors the economic means of production remaining that are still scarce (capitalism rewards the scarce, not the efficient). Land, capital, social connections/nepotism, etc. Logically people without these will be less economically and socially valued in general - I hope I'm wrong. The current productive class have the most to lose from AI. AI IMO breaks meritocracy and skilled based work long term assuming they succeed. Even if not in the next decade, and not the current crop of companies pushing it I'm sure AI will eventually cause this outcome.
- tamimio 11mo agoAI is just the scapegoat; otherwise we should see jobs like administrative assistant, legal, and medical replaced first. But I also think engineering is the worst field to get into. It's neither protected by a license like other white-collar jobs nor by a union like most blue-collar jobs. You end up overworked plus debt from school like white-collar workers but getting paid worse than blue-collar workers. And everyone's okay with that for some reason. Not a single organization is trying to change it. The government is happy with it, companies are obviously loving it, and on top of that, engineers are building the systems to replace them in a few years and they still think they are smart..
- fruitworks 11mo agothere's the PE license
- tamimio 11mo agoIt’s not mandatory, if an employer chose not to care about it, you won’t find any legal issues otherwise in most engineering jobs, that’s not the case in say nursing or legal work. Unless there’s a regulation that requires any engineer should pass certain criteria as seen in other white collar jobs, then it won’t be considered.
- groundzeros2015 11mo agoSoftware development is by nature a boom and bust industry, probably most like film. It’s about creative and isosyncratic contractors picking up projects when they are available. What most people aspiring for a white collar career probably want is a job in IT - managing technology for business is much more stable than developing novel tech. If the thought of needing to move or lose a job strikes you as horrible, this is not a likely career path for you.
- tamimio 11mo agoNeither software development nor IT work is engineering work and shouldn't be considered one either. I am talking about engineering jobs, jobs that you went to school for 4-5 years in an engineering discipline, not a few weeks bootcamp or made-up program like computer science only to be called an engineer later, diluting the whole industry in the process. So yeah, software development might be boom and bust, engineering is not.
- siliconc0w 11mo agoThere is certainly pressure to spend money on and use AI tools. I know multiple people at different companies whose managers brought up low AI utilization in their reviews. This is, of course, really stupid but here we are.
- harshaw 11mo agoWhy? I look at this. I want engineers to use the tools on the stuff that AI is good at so we can do more high value work.
- siliconc0w 11mo agoIt's measuring inputs instead of outputs. If AI is useful, it'll get used.
- s-lambert 11mo agoIf it's obviously useful then people shouldn't need to be prodded into using it. Maybe there are actual downsides to rushing through everything with AI, maybe people can't actually work on the hard things 100% of the time. I just don't understand this need to rush, software already moves fast without AI tools. Software developers already make a lot of money for their companies that their salaries are easily covered. Realistically people could develop software 10x slower than now and the world would still keep progressing.
- EricDeb 11mo agoAmerican devs should support the hire act bill
- silisili 11mo ago25% isn't nearly high enough. Seems more like a government money grab than an effective tool.
- downrightmike 11mo agoJust a shake down. "Be a shame if your store windows were to break" Or like the Tylenol thing being a setup for hostile takeover
- qgin 11mo agoAI is absolutely replacing jobs though. I personally know multiple people whose companies have downsized departments or eliminated departments completely, offloading the work to fewer people using AI tools.
- mrweasel 11mo agoHere AI is more like a magic solution to stretch the employees you have. I don't know a single person who has been replaced by AI, but plenty of companies and government office hopes to be able to get more work done fast with AI. I doubt it will work.
- gtsop 11mo agoNo the OP is right, we had a whole department vanish: translators. Half laid off and half absorbed to other roles. I am waiting for this to backfire eventually, but even if it does, it will still be cheaper to handle the backfire than employing all those people.
- system2 11mo agoCan you list a few tools that replaced jobs?
- qgin 11mo agoAt a big hospital system, nurses call patients with complex medical issues and help organize appointments and tests and whatnot. Previously, they had about 20 people who would transcribe recordings of the calls and then write up documentation for the medical records. Now AI transcribes and writes the report and sends it to the nurse to sign off / make edits.
- system2 11mo agoI am familiar with SOAP. But before AI it was already there, similar voice to text apps. Maybe they became more aware of this tool now?
- nickpsecurity 11mo agore title I literally just said that on Reddit: "They [big companies] were already laying off lots of people and hoarding around 100 billion in cash. This has nothing to do with AI. The elites have been at that for some time for who knows what reason. If anything, they didn't start spending money until the AI boom. You could say AI is destroying jobs for a different reason. The leaders of the companies believe in gold rushes more than a steady stream of investments into forming and growing actual businesses. They didn't or don't believe America is worth investing in. They're simply about extraction."
- moominpapa 11mo agoLost my previous job not to AI but to a pincer movement of Indians taking up positions here in the UK effectively forming a bridgehead to subsequently have the non-management roles outsourced to India. From purely my own anecdotal experience, I found my Indian coworkers very friendly when I could provide something, but once they had the whip hand their attitude was markedly different.
- MagicMoonlight 11mo agoThey then get visas for the outsourced workers to bring them over. And I’m sure they get a nice backhander for arranging it.
- vivzkestrel 11mo agoindian dude here, sorry to hear that. The way it gets talked over in local circles is that most people dont like the concept of minimum wage when they have to pay someone. The thing about most Indians is that they dont have clear distinct personal time vs professional time. Even if a boss asks them to make a presentation at 10 pm, they'll do it. They feel that people of other nationalities mostly developed countries would not put up with such workplace behavior. Unfortunately it is a race to the bottom on that one
- azan_ 11mo agoI think it's not even AI spending, but just the end of ZIRP.
- Animats 11mo agoFrom the article: "We have been following the slow growth in revenues for generative AI over the last few years, and the revenues are neither big enough to support the number of layoffs attributed to AI, nor to justify the capital expenditures on AI cloud infrastructure. Those expenditures may be approaching $1 trillion for 2025, while AI revenue—which would be used to pay for the use of AI infrastructure to run the software—will not exceed $30 billion this year." Are the numbers really that bad? Google has been claiming that their cost per AI search query has dropped by over an order of magnitude.[1] They're presumably reaping the gains of not cranking up a really smart model on dumb questions. [1] https://arstechnica.com/ai/2025/08/google-says-it-dropped-the-energy-cost-of-ai-queries-by-33x-in-one-year/ https://arstechnica.com/ai/2025/08/google-says-it-dropped-th...
- ultra_nick 11mo agoAI isn't replacing jobs. AI spending isn't either. It's outsourcing and can be easily confirmed by cross-referencing H1B approval rates with layoffs. If you've been outsourced, ask your representative to support the HIRE Act: - Creates a 25% tax on outsourcing payments - Creates a “Domestic Workforce Fund” for apprenticeships/workforce development. - Prohibits companies from deducting outsourcing payments.
- klysm 11mo agoHow do you prevent thin wrapper organizations that just contract out “services”?
- evilduck 11mo agoIf we're hypothesizing, then the thin wrapper organizations should or would bear those same taxation and penalty costs when outsourcing and their prices would also be going up.
- klysm 11mo agoNot if they are based in a different country
- evilduck 11mo agoWhat would be the point? If the outsourced devs are based in another country and the thin wrapper shell company selling outsourced devs as a service are based in another country, the expenses to either are likely be to reported to the IRS and State governments identically.
- downrightmike 11mo agoYou don't, you get turtles all the way down the same way they avoid taxes.
- daxfohl 11mo agoI'd say it's more "cost reduction" overall. And it makes sense to me. From my experience over the last few years, features are increasingly lower marginal ROI, and seem to take longer and longer to launch because the amount of coordination required keeps going up. Plus generally expected revenues in this economy are trending downward, so it only makes sense to reduce staffing and focus on only the highest priorities.
- yalogin 11mo agoAI spending is replacing jobs now but all of this spending is in preparation and anticipation of the real AI replacing jobs
- zerolayers 11mo agoHere's a fictional take on it, yet sadly based on real events: https://syntheticauth.ai/posts/synthetic-auth-the-power-problem https://syntheticauth.ai/posts/synthetic-auth-the-power-prob...
- nsainsbury 11mo agoI was laid off recently along with most of the tech team (Australian company ~ very well known brand). There's a handful of people left, but even they know their time is coming soon. And this isn't about AI (well, not primarily anyway). It's offshoring, offshoring, offshoring. IMO, what's taking place now is absolutely transformative and the world economy is in the process of being reshaped. It's not just tech jobs that are being offshored - we're just one of the first/early movers. Many other professional/white-collar jobs (accounting, etc.) are also getting offshored at an accelerating rate. And it's happening all over the western world - it's happening in the US, it's happening in Australia, Canada, the UK, etc. And unlike previous periods of mass offshoring, I don't think the jobs are ever coming back.
- ireadfaces 11mo agoIt is interesting that a similar thing happened when millions of manufacturing jobs were offshored to China and other low-cost sites. Now it has come to the tech industry, and every other industry where it is possible. It hurts when it comes to us. (Speaking as a person in tech in high COL). I hope we will find other roles as people found when they moved on from manufacturing roles too
- etoxin 11mo agoI'm seeing the same thing in Australia. These new tech companies/existing companies were not here for the first wave of offshoring engineers many years ago. basically, the product/service degraded and they brought the product/service back onshore. It's a cycle that will repeat. Product degrades, there will be public outrage, then they will onshore the product to fix the problems caused from offshoring.
- nsainsbury 11mo agoIMO, things are different this time (as someone who has been in this industry for about 20 years now) and I don't see these jobs coming back. For one, many of these companies are now used to their tech teams being remote. The tools, culture, infra, etc. over the last ~5 years has all become remote which lessens the shock of going fully offshore. Two, many tech teams in the western world are already partially offshored and have been for some time now. I know where I worked, a reasonable % of the team was already offshore in low COL countries (India, etc.). What's happening now is just the expansion of that cost saving after initial testing of the waters was successful. Three, the quality gap between offshore teams and their western counterparts is now much smaller, and AI will be used to lessen the gap even further (along with just throwing more bodies at each problem which you can do when your salaries are 1/3rd of what they are here). Four, many products/services now have captured markets with strong network effects, which means they can weather a heavy degradation of services with little to no loss of customers. It's called enshittification, and businesses are doing it now because they absolutely know they can, and get away with it.
- j-bos 11mo agoAt the fortune 500 I work at there's no sweeping layoffs that I've seen. There is a big emphasis on AI, but more relevant to the concerns, there are scoped hiring freezes for US workers, new offshore hires are greenlit though. And I can't help but wonder, what happens to a state when most of its critical infrastructure directly depends on another external state.
- j-bos 11mo agoActually on further consideration, this darkly hilarious, it's doing to knowledge work what's already been done to manufacturing.
- abustamam 11mo agoI think the company I work for has a pretty pragmatic approach for AI utilization. Don't use it to replace jobs, use it to make jobs more efficient (we call it an "enhancer"). IE we won't lay people off, at least not because of AI, we just may not hire as quickly as we did before LLMs, but still attaining similar scale. This goes for all departments, not just tech. We have very strict standards on what code gets accepted (no slop). Whether it's AI generated or not is irrelevant; even senior engineers can be guilty of slop after a long day. But we do have regular meetings to discuss our AI usage and to converge upon common patterns and rules to level everyone up. That being said, I think we as a society are quickly reaching the point where there just doesn't exist enough jobs to keep everyone gainfully employed. There may be new jobs opening up but not ones that people in the middle or ends of their careers can quickly pick up on. I don't think this is a bad thing necessarily, just that when combined with the shitty safety net that the US has, it's a recipe for disaster. If even folks who are working full-time still need assistance for groceries, then we've already failed, and that's not even AIs fault.
- danielschreber 11mo ago>use it to make jobs more efficient I left IT for the time being, but I ask copilot.microsoft.com a question once in a while to see if we've got to AGI yet. Today's question (I admit not so creative) was what's the market cap of TSLA. Its answer was "Tesla Inc. (TSLA) currently has a market capitalization of approximately $429.52 billion USD. This figure is based on the latest trading price of $429.52 per share" It allegedly used a web search to find this out, and it included a screenshot showing the market cap as $1.4B. On the other hand, chatgpt.com prudently tells me to go look it up myself, because it doesn't have live data. I guess OpenAI is winning?
- abustamam 11mo agoI never use LLMs to get current data. Sometimes for fun I'll ask it for product recommendations and it'll routinely make up products that don't exist and confidently even generate links for such products. But for code generation, Claude is awesome. ChatGPT is OK too but I've had much better results with Claude. Weird things happen if a new version it a library came out with breaking changes though. You'll have to write rules or ensure that the new apis are in context. But that's kinda my point. It's not good enough to replace a human, but it is good enough to make a human more efficient.
- mattfrommars 11mo agoI can assure you a lot of veteran devs in my company who had major impact were let ago because of off shoring to India and Poland. My employer is a very well known financial institution, think Blackrock, Bloomberg etc. Public press paints picture of the firm laying off due to adoption of AI. Yet, I can assure you without doubt its not because of it but due to continued offshore. I think we are at the brink of opening another large campus in India, not sure which city. Oh another thing is these full time position in NA were eliminated and replaced with employees from TCS. My own boss is against it but its coming from higher ups. I have no idea what's driving them. We made billion in net revenues last year and we are actually part of the org that is in 'cash cow' category - upper management literally said this too in our town halls
- JumpCrisscross 11mo agoAre visa restrictions deterring or promoting this offshoring?
- epicureanideal 11mo agoLet them offshore if that’s what’s going to happen. And then let the stats show that American employment in certain sectors is tanking, and let the electorate decide what to do about that. Basically, I think this is a multi-round game rather than a one or two round game.
- Striggor6 11mo ago[flagged]
- hhh 11mo agoActually when I have a new group of diverse people in my neighborhood I tend to find it much more vibrant and fun, and I'm not 'losing' it at all.
- carlosjobim 11mo agoWhat's not fun and vibrant about people of your own background?
- hamstergene 11mo agoI am really surprised how well AI excuse works, most journalists just take CEO words as is, and make no effort to assess: is that even credible? Obviously layoffs correlate with AI age, but it's most definitely not AI replacing jobs, not yet. Even in 2025 stories about a job fully taken by AI need to be scraped for, and it's almost always about non-SWE jobs. And in 2023, when the first layoffs already started, models sucked and none of the existing tools and agents even existed yet! But if you search for example for headcount growth in India/Mexico, the numbers can only be described as "booming". I don't know what exactly is going on, but it's pretty obvious the companies are moving offshore or simply doing less work, and for some reason need to lie about why.
- Rastonbury 11mo agoThe Mag 7 minus Nvidia are not the only employers, the cloud providers while big are a microcosm of tech which one industry. 99% of other companies aren't investing in data centers.
- yadaeno 11mo agoSomething like the hire act bill is the only solution: https://www.congress.gov/bill/119th-congress/senate-bill/2976 https://www.congress.gov/bill/119th-congress/senate-bill/297...
- deleted 11mo ago[deleted]