But This Time They Are Putting Folks Who Vote Out To Pasture

On November 24, 2023, I posted about the Coming Crash of the Tech Economy.  My thesis was that negative cash flows; continuing layoffs throughout the sector; and the emergence of new technology that will make many white collar IT jobs obsolete, all point to major contraction across all sectors of the information industry.  My observation was the current economic that have contributed to this significant contraction in the tech sector mirrors in many ways previous crashed of the etch economy.  Five months later, all the trends are discouraging for struggling IT workers.

The staggering amount of losses, 4 Trillion in USD, cannot be ignored when considering how things got to be where they are right now.  It is probably correct to assume that a significant number of those individuals whose capital investment in crypto currency simply vanished are also IT workers whose jobs and livelihoods are now most at risk. 

Besides the almost daily news of layoffs from the biggest names in the IT industry, a most telling sign of the turmoil in tech is those who may have once been The Angel Investor for an IT focused startup are demanding certain fledgling firms simply close up shop.  Entities whose products lack "product-market fit,"  Product-market fit "describes a scenario in which a company’s target customers are buying, using, and telling others about the company’s product in numbers large enough to sustain that product’s growth and profitability."  So if a startup does not have a viable product, then that startup may well not only receive no additional funding, but the principles of that startup could find themselves on the hook for are fund due investors.

With demand of startups software products waning, and the days of easy money now over, any startup still operating is very likely running out of cash.  Elan Gil, a noted investment entrepreneur, estimates that these startup business failures will accelerate in late 2023 through 2024. 

There is likely a mix of companies who have raised anywhere from 2-4 years of cash in 2021 that will not grow into prior valuations, and will need to find an exit or shut down. As such Q3 2023 through end of 2024 (and maybe part of 2025) seems roughly when these companies will start to seek exits and or shut down.

Adding to the Liquidity Crisis, a year of steady interests rate increases have hittech especially hard.  Across the spectrum, it has been declared that the "Days of Easy Money" are over.  As the Business Standard explained, January 10, 2023:

Cheap money—an incredibly popular and influential feature of finance that led to a surge of wealth, speculative trading and booms in ridiculous investments such as meme stocks and digital images of cartoon monkeys—died suddenly in 2022. It was 14 years old. Cheap money is survived by its estranged relative, expensive money.

As the confluence of related and unrelated events overwhelm the industry, displaced IT workers, who have only known the recent boom years, will likely find themselves in dire straights.  With fewer possible employers to chose from, and certainly intense competition for available positions, unemployment among this class of Americans will place stresses on many other segments of the American economy.  Entering into this murky near future employment situation for many white collar workers, is the AI.

A widely quoted research study recently released, March 18, 2023, [pdf will open here] by Cornell University, using quantitative measurements estimates those professions most likely to be impacted by the current generations of the Large Language Models, also known as Artificial Intelligence (AI).  The emphasis is rightfully on language.  Those professions that will become in far less demand over time are those that require written and or verbal language skills.  Among those skills is included computer code writing.

Company Indeed Glassdoor Xerox Atlassian Orchard Color Health Eventbrite Sono Motors Reserve DigitalOcean Neon Divvy Homes Open Co Wonderschool Affirm Olive Al Nomad Health Bark Gusto Zoom eBay Okta Splunk HubSpot Upstart

Date 3/22/2023 3/22/2023 3/9/2023 3/6/2023 3/2/2023 3/1/2023 2/28/2023 2/27/2023 2/17/2023 2/15/2023 2/15/2023 2/15/2023 2/10/2023 2/10/2023 2/9/2023 2/9/2023 2/9/2023 2/9/2023 2/8/2023 2/7/2023 2/7/2023 2/2/2023 2/1/2023 1/31/2023 1/31/2023

No 128 33 172 143 72 126 45 142 46 71 70 14 22 6 150 58 58 7 49 123 4 72 59 118 24

source: https://layoffs.fyi/

The White House released a thorough study of the short term and long term impacts of AI in the workplace.  Using data points from Europe and the US, and across all economic sectors, the White House authors paint a picture of

CCertainly, not all the professionals employed in any one of these industries will lose their jobs all at once.  The adoption of AI will be a gradual but eventual fait accompli.  One firm, expert.ai, offers Language Model Training across many different fields.  There is a certain business logic to the notion of why have a human read what is on the computer screen, when the computer itself will be able to that same task just as well.  /p>