As I have heard from mid level managers and C suite types across a few dev jobs. Staff are the largest expense and the technology department is the largest cost center. I disagree because Sales couldn't exist with a product but that's a lost point.

This is why those same mid level managers and C suite people are salivating over AI and mentioning it in every press release.

The reality is that costs are being reduced by replacing US teams with offshore teams. And the layoffs are being spun as a result of AI adoption.

AI tools for software development are here to stay and accelerate in the coming months and years and there will be advances. But cost reductions are largely realized via onshore/offshore replacement.

The remaining onshore teams must absorb much more slack and fixes and in a way end up being more productive.

> The reality is that costs are being reduced by replacing US teams with offshore teams.

Hailing from an outsourcing destination I need to ask: to where specifically? We've been laid off all the same. Me and my team spent the second half of 2025 working half time because that's the proposition we were given.

What is this fabled place with an apparent abundance of highly skilled developers? India? They don't make on average much less than we do here - the good ones make more.

My belief is that spending on staff just went down across the board because every company noticed that all the others were doing layoffs, so pressure to compete in the software space is lower. Also all the investor money was spent on datacentres so in a way AI is taking jobs.

> I disagree because Sales couldn't exist with a product

There are a lot of counterexamples throughout history.