I'm coming around to it being like getting a pair of industrial grade yak clippers. Yes, there will be a lot of shiny yaks, but the market for shiny yaks is low.
I'm a hot dog chef with over 20 years of experience. Credited with inventing 274 hot dog styles. International awards. World renowned and industry figure.
My entire team, very competent hot dog experts, was laid off after a hot dog cooking machine could do what took us 3 months, in just one day. I've been out of a job for 12 months. The reason? All hot dog making has been offloaded to Claudog Hotdog. "Sorry. Hot dog manual cooking is a thing of the past", one recruiter told me.
I'm working as a software engineer as we speak. I keep applying to hot dog related positions but I get no interviews. Even positions significantly below my pay grade and skillset. No one is hiring. Hot dog cooking is over. We are entering a new era.
I'd take these options from several companies (all selling hotdogs) and wrap them up in Collateral Hotdog Obligations which I'd then offer to investors.
I build bicycles. I was shocked when our internal team built a bicycle that goes to the moon
We are afraid to release it to the public! And thus we are shutting down the company. We don't want humans polluting Moon and the atmosphere and space!
The main question is: what is demand elasticity for software?
If it low, and lower prices won’t generate much new demand, we should expect AI to improve engineering productivity, and for companies to reduce staff.
If it is high, then we should see companies hire more engineers, increase output and lower prices (and earn more).
Bureaucracy creates work so long as it owns the production function. In software that's typically through system upgrades, new API's, etc. The system will grow in internal complexity to its carrying capacity. You'd need someone who understands how to replace parts to prune, but they don't really have the incentive. This effect is reduced where software is less essential to the product, but any software-heavy product (particularly with a moat) will be more susceptible.
Companies try to manage it via CI/CD, outsourcing and internal competition, but no, companies can't magically reduce staff. They can, however, inject fear, which is good for reducing overt bureaucratic games, but actually increases covert bureaucracy and reduces knowledge-sharing, making the problem worse.
Only when incentives are aligned - when developers have an (equity) stake in growing the company - can the culture be open and efficient.
Every time the cost of software development has gone down due to higher level tools we've gotten higher software budgets, more software developers, and more released software. Demand appears to be effectively infinite.
