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As AI Transforms Silicon Valley, Some Tech Workers Face Evaporating Financial Security

1 month 1 week ago

The Washington Post describes a mid-tier executive at Meta as one of Silicon Valley's "winners" whose financial security suddenly "evaporated" as their workforce "pushed headlong into AI and heavy job cuts," creating a transformed job market. "Her ex-husband, a designer at Meta who was laid off in 2020, eventually gave up looking for jobs in his profession. He now lifts boxes at a warehouse." Layoffs.fyi, which tracks announced job cuts, counts more than 800,000 tech workers laid off since 2022, including large staff reductions in recent months at Meta, Microsoft, Oracle and Amazon... "There's this whole tranche of people who've been quite used to being among the most upwardly mobile in society who are all of a sudden saying, 'Now I'm the guy on the streetâs'" said Oliver Raskin, who founded Silicon Valley market research consultancy Signalcraft Insights and has surveyed attitudes in the tech labor force... "The rise of AI, especially, is bound to change the workplace radically," [said Georgetown University historian Joseph McCartin]. "But the way it's going to happen is similar to how technology transformed the auto industry." Ruth Milkman, a labor sociologist at the City University of New York, said that technology workers are getting a dose of what workers in other industries have long complained about: jobs that feel unsteady or rob them of autonomy. "Low-wage workers are used to it," she said... Many layoffs at technology companies are probably a hangover effect from over-hiring in prior years, experts say. And they don't account for a spotty recent increase in hiring in the information industry, which includes employment of software developers and jobs in media and entertainment. Digging deeper, though, some economists say there are signs that Silicon Valley and other technology-reliant parts of the American economy have reached a turning point where they are growing without needing as many people. The notion was encapsulated in a recent talk that ricocheted through group chats across the tech industry: In it, a partner at the start-up incubator Y Combinator heralded a new generation of AI-first companies that will only need human labor for "novel situations," "ethical considerations" and "high-stakes moments." Gad Levanon, chief economist at the labor research nonprofit Burning Glass Institute, said that the number of hours worked in the information sector has dipped since 2022, while the sector's economic output has increased by about 8 percent a year — more than three times the overall growth rate of the U.S. economy. He says the data reveals a sea change in industries, including technology and finance, toward doing more work with the same or fewer people — one that is spreading to other professional classes. "That's the new reality for white-collar and tech-exposed work: output up, headcount flat or down," Levanon said... Raskin, who has worked in the tech world since the late '90s, said that even though the current moment feels unsettling to many, he's hopeful that it's an early chapter in an evolving story. "It's happened many times before," he said, "that something implodes and all these people lose jobs, but then that talent gets cycled into whatever the next thing is — into a new wave of prosperity." In the article tech entrepreneur Anil Dash quips that Silicon Valley techies are "are guinea pigs for what tech dudes want to do to everyone."