THE NEW AI CODE. It may not be curtains yet for software engineering | Photo Credit: Kan Kingpetcharat

Knowing what you know now, would you have taken a different career path after college or advised your family and friends to pursue something else altogether? The other day, a former high school classmate called up to ask if his daughter, who wants to pursue computer science engineering, was making the right choice in a world filled with AI noise. I told him I am no oracle on the future of jobs, But if I were him, I would bet on his girl, who was not only a topper in Std XII but also passionate about the subject.

AI-washing layoffs

Of late, any enterprise announcing layoffs has an ‘Impacted by AI’ label on it. Though companies like Block, Atlassian and Oracle have their own contexts for layoffs, the media narrative suggests AI impact. We are refusing to acknowledge their declining stock price in the last six months as a larger factor.

It might be worthwhile to share the details surrounding a recent layoff, where I was almost a fly on the wall. In this tech company, the CXO informed his VPs that the global HQ had given him a headcount reduction target. He asked how many full-time employees (FTE) could be laid off? The first solution the VPs offered was, “Can we reduce the number of our contractors”? When reminded that the target was FTEs, each manager came up with a few names. The CXO didn’t even ask why those names were picked. There were no discussions on whether AI would replace the laid-off employees. It was redundancy as usual. When I read about this layoff story in the news later, it appeared with an AI flavour.

‘Lump of labour’ fallacy

Significantly, the top 10 AI companies, including OpenAI, Anthropic, and Perplexity, have added 7,500 new employees in the last 12 months. Despite the vibe-coding gains and telling the world to get rid of software engineers, new-age AI companies are adding more engineers themselves. Perhaps we should hold our horses before writing a death sentence on software engineering as a profession. Marc Benioff, founder and CEO of Salesforce, recently said, “Companies are cutting jobs for three very different reasons: cost that got out of hand; data centre financial commitments; and some genuine AI-driven rebalancing.” Treating them as one story is a mistake.

Marc Andreessen, co-founder of venture capital fund Andreessen Horowitz, has an interesting take. His VC firm has invested not only in some marquee new-age companies like Figma, Databricks, Stripe and Roblox but also GitHub, Airbnb, Twitter, and Pinterest. Despite major bets on the future of AI with companies like OpenAI, Elon Musk’s xAI, and Mistral AI, Andreessen recently said most large companies are overstaffed by 25–75 per cent due to excessive pandemic-era hiring and are using AI as a cover to cut jobs. He called it the ‘lump of labour’ fallacy — the mistaken belief that there is a fixed amount of work to be done in an economy, thereby meaning that if one person works more or faster, another works less. It incorrectly assumes that rising automation, immigration, or productivity causes unemployment.

Future tense

Unnoticed amid the news of war and AI, mass hiring in the tech sector has seen a structural shift. No longer can we celebrate the hiring of lakhs of engineering students by large tech firms. The numbers have dwindled due to macro-economic conditions, and with the anticipation that AI can do much of the entry-level grunt work. India, though, still holds promise with 100 new global capability centres setting up shop. However, with 2.5 lakh computer science engineers graduating in India each year, the surface area for new tech jobs is shrinking. Going by the recent Claude AI agent source code leak, the roadmap for the three capabilities Claude has lined up as WIP is interesting — proactive mode; dream mode; and autonomous mode, which may bring agentic AI closer to non-binary human capabilities. According to a Goldman Sachs analysis of 40 years of labour market data, workers who lost jobs due to technological changes saw an average 3 per cent drop in real earnings compared to those displaced by stable roles. In the ten years after losing a job, such workers saw earnings growth that was 10 percentage points lower than those who remained employed. Looks scary?

The reset?

A country that exported close to $300 billion worth of software services last year has been the dream destination for the 8.5 lakh freshly minted engineers each year. This cohort of engineers has mostly chose the IT sector over others like manufacturing, given the salary levels and the sector’s continuous growth over the last three decades. From a time when every neighbourhood kid we knew went onsite, to one where someone close to us is getting laid off, the tech reset is hitting hard. Most jobseekers’ CVs are now laced with some AI skill; every leader has to have familiarity with OpenClaw and how Claude is simplifying the workflow. It’s become tough to differentiate between fluff and reality. All consulting companies are putting out surveys that preach how AI and human beings working together make for a productive workforce.

Suzy Welch’s best-selling self-help book Becoming You has a take on ‘purpose’. She writes that it requires taking action to “go through the fire” of self-discovery and purposefully constructing the bridge between the life you are currently living and the life you want to live. Let’s hope that AI brings the best of us for us and makes it a breakthrough of our lifetime, and not a Kodak moment.

(Kamal Karanth is co-founder of Xpheno, a specialist staffing firm)

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Published on April 13, 2026