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If software costs 80% as much to write, what's unreasonable about thinking that more businesses would integrate more of it, hiring more developers?

Bingo. This additional throughput could be used to create more polished software. What happens in a free market; would your competitor fall behind or will they try to match your polish?

I think both will happen. I was merely demonstrating that just because an AI can't replace the entirety of your work, doesn't mean it won't make you redundant.

Because I've never seen a time saver in software development not being used to write even more software than what should be allowed by the time saving itself.

So, yes, it could happen, I foresee a steep road ahead for junior developers, but if history can serve as a guide, LLMs coding will more likely lead to MORE CODE, not LESS CODERS in general.

This just feels like another form of the mythical man month argument.