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Comment by yladiz | Hacker News Reader

With respect to hiring, of the two points you mention - AI productivity gains for SWE and "no more free money" - I'm confident it's solely the latter, that higher interest rates cut off free money from startups, so they need to be more careful about who they hire. Additionally, there was substantial overhiring during COVID which combined with the interest rate changes lead to a lot of layoffs, and subsequently lead to the conservative hiring in a lot of companies. This leads to a lot more competition than there was previously, both to even get an interview in the first place and to get to the end with an offer.

It's possible that AI may have some kind of impact on the industry too with respect to productivity, but I'd bet that it's nowhere near a 10-20% gain and it's not a factor at all in the difficulty of finding a job.

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I agree. Working as a manager in the industry my take is that AI has had a near-zero actual increase in SE productivity. That’s not to say the C-level perception matches that actual number though. It hasn’t happened at my company but I wouldn’t be surprised to learn that some layoffs from big companies were driven by that perception. I would interpret more as an excuse to get rid of low performers in general.

I think LLMs spitting out code will probably supercharge the "if engineering showed a toy demo, that means we're 90% done and can start taking pre-orders" problem.

Yup - while creating massive tech debt, and weird edge case bugs that are even less sensical than typical ones you’d get.

From what I've seen, AI is used as an answer to the question: "how are we going to be expected to maintain the same velocity with fewer people."

I seem to remember a story that there was a lot of “defensive hiring” — you would hire a lot of technical people to keep them from starting or joining a disruptive startup. This would be a corollary of your higher interest rates pushing down employment by not allowing funding to flow to startups, but the end of such defensive hiring would serve to amplify the drop in hiring beyond just startup personnel.

> It's possible that AI may have some kind of impact on the industry too with respect to productivity, but I'd bet that it's nowhere near a 10-20% gain and it's not a factor at all in the difficulty of finding a job.

I'm not going to make any claim on the actual gain in productivity. My sample size of one for what was sometimes quite repetitive work is a very bad sample.

However, regardless of all other factors (let alone combined with them), I would say that AI has made getting a job far more difficult as AI gives people far more ability to shotgun every single job ad out there. I recently spoke to a recruiter who indicated that for a Senior Golang Dev role in Australia, he had received 400 applications. There is no-where near 400 spare senior Golang devs in this city.

I second this explanation. In fact its not just startups but also a lot of big tech companies were rationally taking advantage of the low interest rates to pursue speculative bets/product features. Tech CEOs were being richly rewarded via inflating stock prices for chasing the potential for future cashflows.

When the macro changed, those bets no longer made rational sense.

The silver lining for guys like Jon Bach (as described in the intro) is that with the abundance of free agents and SF/SV office space, it's probably the a great time to form/find an ambitious team and help try to bootstrap the next Google.

Surely the section 174 changes in Trump's tax bill have to be a part of this as well. Since engineer salaries now have to be deducted as an expense amortized over 5 years rather than in the same year they were incurred, smaller companies with revenue that may not be profitable will still be taxed as if they are.

https://www.bdo.com/insights/tax/current-state-of-r-d-tax-po...

It's not an unreasonable proposition, but it doesn't explain why I'm seeing the exact same hiring trends in Australia, even before the USA election.

Those changes were made during Trump’s first term.

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