IMO: Its going to. But, organizations which frame this replacement as "we're going to fire you and replace you with AI" are going to crash and burn. Instead, we're just seeing per-engineer and per-team productivity increase, and that productivity begins to outpace other bottlenecks in your company process, and you hit another wall. When faced with that second wall, some companies will naturally interpret this as "ok we don't need to hire more engineers". Other companies will try to apply AI (or hire humans) to fix that bottleneck, then go back to hiring engineers.

The dream of a Jira integration directly wired to an autonomous system to quickly close stories with no human intervention will remain a dream for a long time for anything except the lowest-level 10% of stories. Its not interactive enough; the feedback loop needs to be tighter, the vibes need to be conversational, and businesses will get the most value out of the pilot in the chair being someone who in years past called themselves a software engineer. I think we still will; the tools just change.