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Canaries in the Coal Mine? Recent Employment Effects of AI [pdf]

digitaleconomy.stanford.edu

51–60 of 113 posts

Re: Canaries in the Coal Mine? Recent Employment Effects of AI [pdf]

#51
post #15

Any Board which supports management hollowing out future profits by either firing, or not hiring junior staff deserves to have their bonus rescinded. Think like a forestry investor, not a cash crop next season.

Corporate incentives are usually not pushing in this direction.

Then why are so many corporations reducing staff citing ai?

Re: Canaries in the Coal Mine? Recent Employment Effects of AI [pdf]

#53

To me it seems that LLMs are a tool that only increase productivity for given headcount in dimensions that were neglected in the past. For example, everyone now writes emails with perfect grammar in a fraction of a time. So now the expectation for emails is that they will have perfect grammar. Or one can build an interactive dashboard to visualize their spreadsheet and make it pleasing. Again the expectation just cha…

> For example, everyone now writes emails with perfect grammar in a fraction of a time.

And absolutely bloody _hideous_ style, if they are using our friends the magic robots to do this.

Re: Canaries in the Coal Mine? Recent Employment Effects of AI [pdf]

#54
post #15

Any Board which supports management hollowing out future profits by either firing, or not hiring junior staff deserves to have their bonus rescinded. Think like a forestry investor, not a cash crop next season.

It's going to be extremely interesting to see what the field of software dev will look like in a few years given how few juniors are getting hired recently.

Same as a few years after the dot com crash and after the financial crisis (assuming that this is a real phenomenon; I’m not currently convinced); a critical skills shortage.

(This isn’t unique to IT; this cyclical underinvest-shortage-panic pattern happens in a lot of industries.)

Re: Canaries in the Coal Mine? Recent Employment Effects of AI [pdf]

#55
post #45
post #36

The 10% reduction in hiring for young workers is entirely because industry (software, manufacturing) at least in the united states (and probably the world) is contracting and in recession, while the services and government sector has been the main sector growing since a long time now - completely due to economic and geopolitical reasons, nothing to do with AI.

Genuine curiosity: how do you know that software is in a recession? What measures do you use to determine this? And how do you know that the recession is not AI driven? I don't think it is either, but it's more of a feeling; I'm not sure how I would make that argument more grounded.

Check sum of free cash flow of major tech co.s. you'll soon find out that the cash needle of industry as a whole is not moving that much.

They are just round tripping the cash that was sitting in their accounts through investments that make their way back through advertising channels or compute channels.

Once you see the bigger picture, you'll realise its all just a Fugazi post covid

Re: Canaries in the Coal Mine? Recent Employment Effects of AI [pdf]

#56
post #7

LLMs are very useful tools for software development, but focusing on employment does not appear to really dig into if it will automate or augment labor (to use their words). Behaviors are changing not just because of outcomes but because of hype and expectations and b2b sales. You'd expect the initial corporate behaviors to look much the same whether or not LLMs turn into fully-fire-and-forget employee-replacement to…

> LLMs are very useful tools for software development That's an opinion many disagree with. As a matter of fact, the only limited study up to date showed that LLMs usage decrease productivity for experienced developers by roughly 19%. Let's reserve opinions and link studies. https://metr.org/blog/2025-07-10-early-2025-ai-experienced-o... My anecdotal experience, for example, is that LLMs are such a negative drain on…

Probably depends on how it’s being used.

I use LLMs every day. They are useful to me (quite useful), but I don’t really use them for coding. I use them as a “fast reference” source, an editor, or as a teacher.

I’ve been at this since 1983, so I’ve weathered a couple of sea changes.

Re: Canaries in the Coal Mine? Recent Employment Effects of AI [pdf]

#57
post #39
post #36

The 10% reduction in hiring for young workers is entirely because industry (software, manufacturing) at least in the united states (and probably the world) is contracting and in recession, while the services and government sector has been the main sector growing since a long time now - completely due to economic and geopolitical reasons, nothing to do with AI.

Yes. And unfortunately (or luckily for some) the end of the low interest and geopolitical changes aligned with the advent of LLMs.

And what many people don't notice: interest rates are not high.

Re: Canaries in the Coal Mine? Recent Employment Effects of AI [pdf]

#58
post #32
post #7

Earlier quoted context omitted.

> LLMs are very useful tools for software development That's an opinion many disagree with. As a matter of fact, the only limited study up to date showed that LLMs usage decrease productivity for experienced developers by roughly 19%. Let's reserve opinions and link studies. https://metr.org/blog/2025-07-10-early-2025-ai-experienced-o... My anecdotal experience, for example, is that LLMs are such a negative drain on…

There are many ways to use an LLM. Writing code is a bit crazy, maybe writing tedious test case variations. But asking an LLM questions about a well established domain you're not expert in is a fantastic use case. And very relevant for making software. In practice, most software requires you to understand the domain your aiming to serve.

Not sure why your post was dinged. I have used them for exactly this, and it has been amazingly effective.

Re: Canaries in the Coal Mine? Recent Employment Effects of AI [pdf]

#59
post #33

Earlier quoted context omitted.

Really? That's crazy. I'm earning a bit over 5k in the Netherlands. Granted, not Amsterdam, but still.

before or after taxes ?

Before taxes, always before taxes.

Comparing salaries between countries with vastly different approaches to taxes, health insurance, living cost, hidden side costs etc. is hard and can easily be hugely misleading.

Not even including any subtle things just what "before and after taxes" means can differ. E.g. where I live "after taxes" does for most people not just deduct taxes but also the base health insurance cost and some other things (but to make it more fun, only most but not all people. This means what after tax means can differ between neighbors ).

And then there are so many hidden cost which can influence taxes, e.g. in some areas you practically have to have a car this means that in effect the cost of a car isn't that different from a fixed sum tax, if you consider social standards it even scales with income up to a certain point income like most taxes (and cost x10+ if you can't drive a car for health reasons). On the other hand if you live in a area with decent public transportation and then a car is a Luxus good, but someone has to pay for the public transportation, and if you area isn't overrun by well paying tourists this means you likely pay more tax (but as public transportation tends to scale better you still likely save money especially if you aren't wealthy).

Anyway so comparing after tax in vastly different countries is IMHO a folly. And even before tax is tricky but you have to choose something. I guess another option is "what to frugal living people with reasonable health insurance and rent have left over at the end of the month" is theoretically the better statistic, but just not practical.

Re: Canaries in the Coal Mine? Recent Employment Effects of AI [pdf]

#60
post #45
post #36

The 10% reduction in hiring for young workers is entirely because industry (software, manufacturing) at least in the united states (and probably the world) is contracting and in recession, while the services and government sector has been the main sector growing since a long time now - completely due to economic and geopolitical reasons, nothing to do with AI.

Genuine curiosity: how do you know that software is in a recession? What measures do you use to determine this? And how do you know that the recession is not AI driven? I don't think it is either, but it's more of a feeling; I'm not sure how I would make that argument more grounded.

Well, the best measurement is hiring slowdown and bankruptcies. Bankruptcies in the US are up 13.1%.

Traditionally, you wouldn't look at the release of a productivity tool coinciding with a hiring slowdown and assume that it's automation causing the hiring slowdown, your first instinct would be that the sector is not doing well.

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