Memory capacity and commercial compiler development
shape-of-code.coding-guidelines.com
shape-of-code.coding-guidelines.com
Grace Hopper?
Is he saying that GCC implemented them just as they became viable on lower end hardware?
To begin with, gcc didn't target low-end hardware; low-end hardware of 1985 (the beginning of the GNU Project) wasn't capable of running serious OSes, so Stallman ignored it in favor of workstations built around Motorola 68000 CPUs (I believe).
But that's beside the point: He's saying that once lower-end systems began to be as capable of the optimizations as high-end systems were previously, the expectations of compilers for low-end systems began to match the expectations of compilers for high-end systems. He's also implicitly making the point that, once CPU speed is above a certain minimum, the thing that most limits a computer is a shortage of RAM.
A compiler for an MS-DOS system with a few hundred K of RAM can't do advanced register scheduling (not that the 8088 has a lot of registers to begin with) or code transformations but that's OK, because nobody expects it to. All people expect is for their Borland Pascal or Pacific C or whatever compiler to emit machine code that correctly implements their algorithm and, if it's a bit slow, they'll grab Ralf Brown's Interrupt List and other reference material and start hacking assembly.
In Linux, in 2011, people expect gcc to not only correctly unroll loops, but to transform recursive functions into an iterative form and then unroll the resulting loop. (gcc can, actually, do this.) They expect gcc to use MMX opcodes in somewhat-ingenious ways to speed up string handling; and as an aside most of the more interesting opcodes of the x86 ISA are another thing the solo MS-DOS hackers didn't have to worry much about until near the end of the MS-DOS era. They expect, in short, a compiler that would have been at home on a very high-end system as recently as the early 1990s and is therefore too complex for any single human to write unaided. (Well, perhaps Knuth could, but Knuth doesn't scale.)
Programs have seen an explosion in feature set. For compilers this feature set includes optimzation, and additionally things like AutoComplete/IntelliSense, debug information, precompiled headers, etc...
With that said optimization probably dominates, in terms of headcount, what most compiler devs work on.
Then again increased computing power in general enables more complex software with more specializes software. I have heard that Safari is the product of a very small team, but that's the exception.
The individual productivity is probably higher than before, but the need (or expectation) is even higher than that.
On the other hand, a modern kit car would make the young Karl Benz green with envy. A modern kit airplane would make the Wright brothers... well, they were pretty emotionally reserved, but I think I can safely say they would be intensely interested in every single aspect.
I think the main part he leaves out is that not only do we have better, more complex tools, we have better, more complex tools to build tools. The continuing expansion of expectations is only natural given our continuing expansion of capacity.