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AI isn't replacing jobs. AI spending is

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Re: AI isn't replacing jobs. AI spending is

#71

Post by soneca »

qwertyuiop_ wrote: post #23
Glyptodon wrote: post #20

As a recently laid of senior engineer, to the extent that my job was replaced, it was replaced with offshore junior devs who'd already been working with the company for over year with a pretty rough level of productivity by man-hour, though maybe taking 3x the time to get things done is worth it if they're cheap enough. Which is to say I see my layoff as as cost cutting backed by a premise that there is no value in r…

https://www.reddit.com/r/Layoffs/comments/1j3c5in/it_seems_t... https://bloomberry.com/blog/amazons-layoffs-tell-half-the-st... https://www.theregister.com/2025/03/27/ibm_cuts_jobs_in_us/

I was told that the main reason the “Who is hiring?” thread (and other job boards for startups) has much fewer remote positions that are global (the vast majority is Remote US now) is because of a legislation that reduces a fiscal incentive when hiring software engineers and the reduction is much more aggressive when the engineers are from outside the US.

Doesn’t it affect big tech companies? Only startups?

I would guess the opposite, with big companies being much more savvy and influenced by fiscal incentives.

Re: AI isn't replacing jobs. AI spending is

#72

Post by alecco »

alephnerd wrote: post #42
alecco wrote: post #38

Earlier quoted context omitted.

Are they investing tens of billions in new offices in those non-Indian countries? My other comment: https://news.ycombinator.com/item?id=45867014

Yes. (Still in process of generating the list) Poland [0][8] Ireland [1][2] Czechia [3][4] Canada [5][6] Turkiye [7] The expansion of Indian offices is a result of the reverse brain drain that accelerated during the early COVID layoffs along with the EB1/2 backlogs - a number of Staff and above Engineers, EMs and above, and Sr PMs and above who were on work visas were either cut or given the option to relocate to Ind…

[0] no concrete number, and wording implies intent in the order of 1 billion total

[1] only $135 Million

[2] only 1,300 new employees (over 6,000 current); meanwhile "Apple India leases [...] likely to be one of the largest single-tenant office leases in [Bengaluru]" https://timesofindia.indiatimes.com/technology/tech-news/app...

[3] Never even heard of Cato Networks, and no figures. So irrelevant.

[4] onsemi manufacturing $2bn, not relevant as this is manufacturing numbers (Apple India is expanding multiple times that)

[5] No numbers, 2,934 employees. Mentions increment 20% of local market and an acquisition. Not relevant.

[6] Amazon plans 8,500 employees in the two [Canadian] cities. Meanwhile "Amazon to invest $233M to strengthen India operations network" https://www.aboutamazon.in/news/operations/amazon-to-invest-... (OTOH: they are laying off 800-1000 in India, out of over 15,000 desk employees just in Hyderabad)

[7] Uber to invest $200 mln in Turkey. Peanuts compared to the billions in my links.

From your submissions it seems like you are Indian or something.

Re: AI isn't replacing jobs. AI spending is

#74

Post by heywoods »

This article gets the phenomenon right but the causation wrong: it's not "AI spending vs. AI replacing jobs". both are happening simultaneously, and they're causally linked.

The spending-revenue gap is real. Hyperscalers are projected to spend $300-550B on AI infrastructure in 2025[1] while generative AI revenue won't exceed $30-40B [2]. Amazon's capex jumped from $48B in 2023 to $84B in 2024 to a projected $100B+ in 2025[3], that's capital intensity doubling from historical norms of 11-16% to over 22% [4].

But here's what the article misses: this isn't financial desperation. When Amazon's CEO announces 14,000 layoffs and explicitly states that AI will enable "fewer people doing some jobs"[5], he's revealing the strategic logic — show me the incentives and I'll show you the outcome. Companies aren't cutting jobs despite AI spending; they're cutting jobs because they know AI spending will pay off.

To be clear, the article treats the spending-revenue gap as evidence of irrationality. But infrastructure buildouts always precede revenue: railroads looked insane before they transformed commerce, electricity grids consumed massive capital before delivering returns, the internet required enormous infrastructure investment before creating trillion-dollar companies.

What's different now is companies are pulling the future forward. If we take this article at face value which I can appreciate is a BIG “if” then AI is already automating 25% of tasks and delivering 10-55% productivity gains[6] so they're not waiting for AI to replace jobs organically. They're cutting headcount now to fund the infrastructure that will make those cuts permanent.

More broadly, this is rational capital reallocation in a winner-take-all race. Companies that don't build AI infrastructure won't gradually decline, they'll lose competitive positioning entirely. That's why Meta is using off-balance-sheet financing for a $27B data center[7], why Oracle is borrowing $25B annually despite already carrying 450% debt-to-equity [8]. They're all-in because the alternative is obsolescence.

The real story isn't "spending causes cuts" it's that AI infrastructure commoditizes human expertise, the complement to compute infrastructure. Companies are trading labor costs for compute infrastructure because they've correctly identified compute as the new moat. The job cuts aren't the price of spending on AI; they're the business model shift that AI enables.

The article is right that we're not seeing mass AI job replacement yet. But the job cuts are happening in anticipation of replacement, not as an unfortunate side effect of spending. That's not desperation just business strategy.

-- 1.(Morgan Stanley: https://www.datacenterdynamics.com/en/news/morgan-stanley-hy...) 2. (Grand View Research: https://www.grandviewresearch.com/industry-analysis/generati...) 3. (CNBC: https://www.cnbc.com/2025/02/06/amazon-expects-to-spend-100-...) 4. (Cerno Capital: https://cernocapital.com/accounting-for-ai-financial-account...) 5. (CNBC: https://www.cnbc.com/2025/10/28/amazon-layoffs-corporate-wor...) 6. (PwC: https://www.pwc.com/gx/en/issues/artificial-intelligence/ai-...) 7. (Fortune: https://fortune.com/2025/10/31/metas-27-billion-bet-turns-ai...) 8. (The Register: https://www.theregister.com/2025/09/29/oracle_ai_debt/)

Re: AI isn't replacing jobs. AI spending is

#75

Post by paulpauper »

dahart wrote: post #13

If Amazon’s layoffs aren’t AI driven, and AWS is making more money than it’s spending on AI infra… how is Amazon evidence of AI spending replacing jobs? This is an interesting topic, but this particular article left me pretty unsatisfied, it feels like juxtaposing a bunch of barely related numbers with some very popular talking points, but no new information? It hints at “AI washing” without doing any digging at all,…

Large companies add and remove jobs all the time. It's just the the latter gets much more media coverage. Jobs are always being created and destroyed, for all sorts of reasons.

Re: AI isn't replacing jobs. AI spending is

#76

Post by zbentley »

random9749832 wrote: post #68
hshdhdhj4444 wrote: post #67

Earlier quoted context omitted.

No conspiracy theories are necessary here. The numbers speak for themselves. Here is an article putting together data from GitHub about SW developers per country. https://data-player.com/highest-number-of-software-developer... When talking about outsourcing jobs from the U.S., you’re obviously gonna exclude the U.S. China is also not a factor. Neither are Western European countries or countries like Japan and S Korea…

Here you go, h1b hires still get paid American salaries so that throws the whole 'they get hired because they are cheap' argument out of the window: https://fortune.com/2025/09/22/india-government-responds-tru... >70% is a pretty insane number that certainly speaks for itself. Also, when you start giving a lot of tech jobs to people from one specific country, then the github developer numbers will naturally reflect t…

Grandparent was referring to outsourcing, not H-1B hiring.

Re: AI isn't replacing jobs. AI spending is

#77

Post by terminalshort »

darth_avocado wrote: post #14
goalieca wrote: post #6

I can't read the article but that won't stop me from commenting.. This year alone something like 400B was spent on investing in chips, datacenters, electricity buildouts. That's 400B that could have otherwise been invested in people. While i don't doubt that people will find a few solid business cases for LLMs, i am on team-bubble. I don't think this investment will add 400B worth of value and I very much doubt that…

Bah, all of that is still employing people. Companies have completed almost $1T of stock buybacks this year. Since 2018, with the exception of 2020, that number has been between $800B and $1T every single year. And that number has been more than $500B since the 2008 recession. AI spend is bad but it’s not even close to how much stock buybacks have ruined the employee wages and employment prospects.

You think the companies are just going to give you the money if they don't do buybacks?

Re: AI isn't replacing jobs. AI spending is

#78

Post by dehrmann »

Glyptodon wrote: post #20

As a recently laid of senior engineer, to the extent that my job was replaced, it was replaced with offshore junior devs who'd already been working with the company for over year with a pretty rough level of productivity by man-hour, though maybe taking 3x the time to get things done is worth it if they're cheap enough. Which is to say I see my layoff as as cost cutting backed by a premise that there is no value in r…

Hacker News doesn't like to hear it, but remote work is a big part of this. All that effort convincing management you're just as effective working remotely was also a collective sales pitch to outsource your role.

Re: AI isn't replacing jobs. AI spending is

#79

Post by csullivannet »

alephnerd wrote: post #57
evantbyrne wrote: post #54

Earlier quoted context omitted.

I was making $50/hour fresh out of college back in 2014. And I worked remotely. $45/hour today is not great given the cost of living.

London and Toronto have a similar CoL as the Bay Area and $45/hr is a mid-career tech salaries in both Greater London and GTA. Edit: can't reply but every single white collar job provides an employer healthcare plan that is equally as competitive as the public healthcare plans in Canada and the UK. And especially if you were being paid $50/hr as a new grad in 2014. Edit 2: > And I was in Michigan. All the more reason…

$45/hr is low for GTA. I was making about that in Toronto in 2017 with two years experience, one year vocational degree, and a bachelor's in a completely unrelated field.

Re: AI isn't replacing jobs. AI spending is

#80

Post by Spooky23 »

random9749832 wrote: post #31
diamond559 wrote: post #25

Earlier quoted context omitted.

Actual Indians, as always. Humans are cheaper, and have the capacity for long term memory formation.

I would say it is more sinister than just a cost-benefit analysis and plain racism in hiring. Cheap talent exists in far more places than India but somehow it almost always is India. Not only that but I have seen the strangest LinkedIn profiles where people graduate from no-name Indian universities and get a big-corp job here in the West like it is nothing. Even Japan has become pro-Indian on immigration for tech: ht…

The Indian diaspora is huge and you have second and third generation folks in executive office all over. As a political force, south Asians are increasingly powerful as well in many states.

There’s a lot of opportunities for personal networks, nepotism and plain old corruption to work. (Who is going to figure out that somebody dropped a few gold coins to your sibling as a kickback?) There’s a much smaller network of people with relationships to Eastern European or other companies.

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