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The Companies Cutting Headcount for AI Will Lose to the Ones Who Didn't

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Re: The Companies Cutting Headcount for AI Will Lose to the Ones Who Didn't

#81

Post by noodletheworld »

pjmlp wrote: post #35
embedding-shape wrote: post #8

Cutting people because of AI makes no sense, you know these people are good without AI, you'd want to keep them! Freeze the constant over-hiring instead, and take care of the people you know aren't lobotomized yet, and train them if needed. I'm seeing so much shedding of knowledge workers though, even though AI clearly isn't ready to replace people, just ready to augment them currently, that it looks like looney-tune…

The major issue, is that once people are more productive with AI, you are able to replace people because less of them are required. You see this in enterprise consulting, wiht the increase in cloud, serverless, SaaS/iPaaS, low code/no code, content generation and translations, followed by AI agent orchestration, the teams can be reduced down to about 1/3 of what they used to be. It isn't as if there are enough projec…

> It isn't as if there are enough projects around to keep the other 2/3 busy, so eventually when there are enough of those people on bench they have to find something else.

Eh, are they doing that though?

Anecdotally, firing people “on the bench” isn't whats happening.

Read the tweets. Listen to people still working at these big corps. They are gutting teams and pushing more work onto people because they believe they can be more productive, not because they are.

Lets that sink in.

People are being made redundant on the basis that leadership believes that in the future they will have an over capacity and theyre cutting early to avoid the bench scenario.

It is speculative.

What this article is arguing, is that, that is stupid.

If, in the future, you need to spin up new initiatives, youve screwed yourself by disposing of your excess capacity in the magical hope that your current capacity will magically increase itself by … spending more money on tokens.

Its just nonsense.

AI is just an excuse for poor historical decisions and unfortunate global economic conditions.

The “cuts due to AI” will be real. There will be people sitting idle as the models improve and people learn to use them better.

… but right now?

they're not. Im not. My friends arent. My former work mates arent. The people left at these companies arent. The people being cut werent (except perhaps, at meta)

Its stock price hype theatre.

Re: The Companies Cutting Headcount for AI Will Lose to the Ones Who Didn't

#83

Post by pjmlp »

redwall_hp wrote: post #75
pjmlp wrote: post #35

Earlier quoted context omitted.

The major issue, is that once people are more productive with AI, you are able to replace people because less of them are required. You see this in enterprise consulting, wiht the increase in cloud, serverless, SaaS/iPaaS, low code/no code, content generation and translations, followed by AI agent orchestration, the teams can be reduced down to about 1/3 of what they used to be. It isn't as if there are enough projec…

If you're increasing productivity, you should be doing more and growing, yes? If you're cutting payroll costs and trying to have the same level of capacity...your business sucks and you deserve your stock tanking. Layoffs are a strong signal that a business is not investing in growth and is just trying to wring more profit from the same thing. If investors were rational, they'd walk away. Maybe replacing the expensiv…

In consulting you don't make magically customers out of nowhere, and there is a limited pool of customers to feed from.

Re: The Companies Cutting Headcount for AI Will Lose to the Ones Who Didn't

#84

Post by zipy124 »

sailfast wrote: post #32
skinfaxi wrote: post #15

Earlier quoted context omitted.

> One datacenter rack of NVIDIA Vera Rubin GPUs costs $8 million. That's about the same cost as a team of software engineers. How many engineers do you think that can pay for? At 100k/year that's a pretty huge team.

Where are you finding engineers at 100K/yr all-in? Also how many of them will be as good at coding as the models you deploy on the rack? Also you need both now. It’s not enough to just have humans, and that OpEx needs to come from somewhere. I’m not happy about it - just the way it is.

Europe. 100k USD is about 75k GBP, which deducting National Insurance (our social security program) and pension brings you to a salary of £63k roughly. You can easily hire good devs for this amount (especially outside of london).

Re: The Companies Cutting Headcount for AI Will Lose to the Ones Who Didn't

#85

Post by whazor »

A friend of mine works at big corporate. He is in meetings all the time and barely codes. For him a 20$ AI subscription is more than enough.

I'm personally at a fintech startup and have a 100$ subscription. Our org is much leaner and its much faster to ship stuff. What used to be entire departments or teams can now be done by two or three people. Three people to ensure we share context and have a decent tram factor.

Re: The Companies Cutting Headcount for AI Will Lose to the Ones Who Didn't

#86

Post by koliber »

The article makes a good point, but it's based on a polarized view that people make good judgement and AI is incapable of making good judgement.

I've worked with people who demonstrated below-average judgement, and I've seen cases of good judgement from AI. I think if a company can identify the poor performers and part wit them, there is a decent chance that the remaining people with AI in hand can more than make up the difference.

Re: The Companies Cutting Headcount for AI Will Lose to the Ones Who Didn't

#87

Post by xandrius »

redwall_hp wrote: post #75
pjmlp wrote: post #35

Earlier quoted context omitted.

The major issue, is that once people are more productive with AI, you are able to replace people because less of them are required. You see this in enterprise consulting, wiht the increase in cloud, serverless, SaaS/iPaaS, low code/no code, content generation and translations, followed by AI agent orchestration, the teams can be reduced down to about 1/3 of what they used to be. It isn't as if there are enough projec…

If you're increasing productivity, you should be doing more and growing, yes? If you're cutting payroll costs and trying to have the same level of capacity...your business sucks and you deserve your stock tanking. Layoffs are a strong signal that a business is not investing in growth and is just trying to wring more profit from the same thing. If investors were rational, they'd walk away. Maybe replacing the expensiv…

I think the issue is that at any given point the work required to fire a 100-200k engineer is less than making that engineer do work to make you that much.

If you're growing obviously it's stupid to fire but if you have plateau'd the easiest gain is to trim the fat, so to speak. Also once a company is acquired by a private fund, everyone becomes a title and a number in a spreadsheet, that's all.

Re: The Companies Cutting Headcount for AI Will Lose to the Ones Who Didn't

#88

Post by rdtsc »

elktown wrote: post #59

I think the unfortunate reality is that lots of companies in our industry have suspiciously inflated employee counts in the first place. Even when removing AI and the pandemic over-hiring, I wouldn't have been surprised to see corrections sooner or later. Employee count seems to correlate to stock market incentives - which is how GitLab is like 5x larger than Valve.

That’s the true answer. AI is just used as an excuse for “oh shit, we over-hired, and it would be nice if we had an excuse to shed these people”. Then suddenly AI popped up, and well, that’s a nice excuse.

Returning to office was the previous excuse, so now they have the next one ready to go.

Re: The Companies Cutting Headcount for AI Will Lose to the Ones Who Didn't

#89

Post by TeriyakiBomb »

dgellow wrote: post #71
TeriyakiBomb wrote: post #66

In reality there are two kinds of layoff going on. Idiots who truly believe that AI will actually replace a significant amount of the workforce (Long term, it will not but some jobs displaced) and those who have internalised that ZIRP is over, they need to be more lean as VCs have closed their wallets and saying "We've revolutionised our workflow with AI" than "We haven't turned huge investment debt into profit in 5…

But we see layoff from companies that are making record profits, how does that fit here? Are you saying all of them are AI-idiots?

That's the less common third kind. late 10s tech spending was absurd, it's the same excuse as the first but again, an easier way to reduce Capex for staff they don't need.

Re: The Companies Cutting Headcount for AI Will Lose to the Ones Who Didn't

#90

Post by pjmlp »

noodletheworld wrote: post #81
pjmlp wrote: post #35

Earlier quoted context omitted.

The major issue, is that once people are more productive with AI, you are able to replace people because less of them are required. You see this in enterprise consulting, wiht the increase in cloud, serverless, SaaS/iPaaS, low code/no code, content generation and translations, followed by AI agent orchestration, the teams can be reduced down to about 1/3 of what they used to be. It isn't as if there are enough projec…

> It isn't as if there are enough projects around to keep the other 2/3 busy, so eventually when there are enough of those people on bench they have to find something else. Eh, are they doing that though? Anecdotally, firing people “on the bench” isn't whats happening. Read the tweets. Listen to people still working at these big corps. They are gutting teams and pushing more work onto people because they believe they…

In consulting firing people “on the bench” happens regularly if the sales pipeline cannot keep everyone busy, there is only so much agencies pay from their own pocket if there are no outsourcing deals landing.

In some of those well known offshoring companies, being on bench automatically means a downcut on the salary as cost measure.

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