‘Study hard, become a developer, get a stable job at a big tech company, and money will never be a problem.’ We all have heard those words; some of us even offered them as advice to youngsters doubting their career path, or we simply overheard them out of context and assumed that developers had become the ‘new’ Doctors—a stable, high-income role always in demand and with higher salaries than most other professionals.
The U.S. Bureau of Labor Statistics forecasts a 22% increase in the demand for the role for 2029, and no other source indicated the opposite. Additionally, the lifestyle that the job offers, such as travelling the world and having flexible hours, all with a solid bank account, makes it an alluring option for people worldwide. With so many advantages, what could be triggering the massive waves of layoffs in tech we keep hearing about?
According to a report by Tech Sector, 428,449 people working for tech companies were laid off in 2022 and 2023 combined, and all news suggests that 2024 is picking up at the same pace, with 8,851 employees already laid off by July of the year. Additionally, after a continuous increase from the early 2000s, developer salaries suddenly halted their growth in 2019. New data suggests that the average wage has dropped by 9%-15% worldwide and as much as 30% on high-paying positions in big tech.
Without rushing to say that AI is taking our jobs and salaries, let’s examine all the factors that brought the declining need for developers and the stagnating wages to our attention and ultimately make a well-analyzed guess on what the future holds.
Is it a Matter of Supply and Demand, or is There More?
Economic principles are still valid no matter how disruptive and unpredictable the tech world is.
On the macroeconomic aspect, the global recession caused mainly by the pandemic affected every industry, even ‘virtual’ ones. The pressure to save costs was not only felt by local physical businesses, which had to effectively stop their activity for a large part of two years, but also by tech.
Another major factor to consider is the number of junior developer positions available today and the ease of filling them compared to the past. There are now more developers than ever, and the growth rate is accelerating, considering a major part of new developers are self-taught and located anywhere in the world but equally as able as their peers located in counties where big tech is settled. Naturally, that competition has caused stagnating or even lowered entry-role salaries.
On the micro aspect, there are industry-specific factors to consider that only apply to the tech sector and its development at the latest.
Silicon Valley’s Hiring Bubble
Big tech companies are known to hire hundreds or even thousands of developers simultaneously. Where does this demand come from? And why is there news of massive layoffs almost every few months?
Just recently, Google reported a revenue jump of 13% as it was spending $700 million on severance and other expenses tied to layoffs. Microsoft let go of almost 2,000 workers just five days before reporting a 17.6% revenue spike. The answer behind this layoff sounds apparent when you consider the revenue. However, what brought the situation to this point is more complicated.
First, every new project draws in the best of the best in a rush to get the latest thing going. Imagine the Metaverse in 2020 and how, from a significant promise, it turned out to be almost nothing.
Second, tech companies aim to keep talent for themselves rather than allowing competitors to access it. Few people in the industry know that the moment you become part of the team of a big tech company, almost every time you are not allowed to work for a competitor, years of the contract expire.
It’s not all doom and gloom, though. A few clicks north over the border, Canadian developers are not feeling the same pressure. On the contrary, their demand is still rising, mainly in areas like data analysis, cloud computing, and, of course, AI. The gaming industry is somewhat stabilizing from its rapid growth periods, but you’ll see new Canadian gaming projects popping out here and there, as these positions are still sought-after due to a group of like-minded enthusiasts.
The Startups That Never Start
The tech world is not only built on massive Corporations launching new products and, more often, failing. A quick binge-watch of Dragon’s Den will make it obvious how many new apps and tech projects from unknown people with great ideas get funded. But where does the money go in the nine out of ten failed startups?
Teams form, marketing costs accumulate, product launches often get detailed, the project lasts a few years, and the money eventually runs out. Even if the startup starts to earn money, it can rarely reach the projections it showed in its pitch; investors seldom get their return, and either letting go of developers, lowering their wages or opting for remote workers from underdeveloped countries are the only options left to continue operating the business.
Remote Work Versus Local Wages

On the topic of remote work, we know that it’s here to stay, and no factor suggests it won’t, especially for tech jobs. While a developer from India hired by a UK company is much more likely to enjoy a better salary than their colleagues working for local companies, that wage is still adapted to the cost of living.
Developers competing for the same remote job eventually bring that competition to the company’s home country. Following up on the example above, the local devs who had their jobs secured with the UK company eventually will need to compromise for a lower salary unless, of course, the company is wholly dependent on a local team’s know-how and experience, as it rarely happens with today’s increasing pool of talent.
Multiple companies opted against remote work after 2021, trying to return to their pre-pandemic productivity levels. However, costs are still on the rise, and the overall economic pressure has translated into lower industry salaries,
Corporate Culture
The rise and fall of developer demand is not always attributed to a new project but often to a shift in corporate culture. Diversity and multiple side projects are keywords in all big corporations, but the tendency to hire for both of those reasons can backfire and damage employees in the long run.
Elon Musk’s firing of Most of Twitter’s Software Engineers when he took over can be used as an example of counter-modern corporate culture. The backlash was massive, yet, according to Musk, the company needed far fewer people to run efficiently. He insists on the power of having a small but efficient team that works on the things that matter.
The following logic suggests that engineers who stay might enjoy a high salary, but won’t those who get fired settle for a far lower one in search of immediate employment?
Is AI Truly Turning Against Its Creator?
We’ve come to answer what everyone was waiting for: the rise of AI and how it can replace the work of developers at a fraction of the cost. There is an argument to be made that entry-level coding jobs could become obsolete, and even more advanced ones could follow the same fate as automated systems become more powerful.
AI is not the ‘next big thing’ anymore; it is ‘the thing’ on which companies spend billions to be more efficient and eventually save on costs. But that’s not the side of the story. Artificial intelligence is a tool, and what it does is transform the role of the developer by focusing more on problem-solving, human judgment, and creativity.
What Can Devs Do to Secure the High-income Roles?
The answer is as old as the Industrial Revolution. A developer cannot change the conditions surrounding the industry, but they can tailor their response to them.
They specialize in a niche, leaving room to adapt to change and accept that their career will depend on the effort they put into reinventing themselves throughout every swing on demand and disruptive tech that comes along the way.