- FAANG got bloated during the bubble and anticipated growth that isn't materializing as fast, so they're cutting headcount. Similar for other big non-FAANG public companies.
- Down stock market means that public companies can't get as much capital for new investment by selling shares.
- High interest rates increase cost of debt, meaning nonprofitable companies relying on debt to grow will not grow as fast and may cut costs to become profitable or cash flow positive.
In other words, I think the impact will mostly be on "growth" companies that are not profitable, and companies that got bloated in the past few years.
I think companies will still hire software engineers, but the places with the most headcount are going to pay less. They didn't become bloated during the COVID bubble because they pay less. Think lower growth, stable, profitable, private companies that need folks to keep the lights on, where engineering is a cost center and not the company's focus. The places that pay top dollar will be more limited because growth prospects have narrowed. Entry level folks that can code will probably find a job, but it might not pay well.
I don't have a crystal ball, but I don't think it's going to be as bad as 2000 or 2008. We'll see though. The next 2 quarters will be informative.