In a recent post I explained why “tech” is a clown-world career. I had two follow-up thoughts, which point in the same direction, and led me to predict that it will be a long while before we see excesses in the tech sector again, if at all.

The first thought builds on a comment left by Big John who wrote:

Hilarious that the tech workers forget the old adage “if you get something for free you’re the product “. That do nothing 200k job meant millions more in capital for the owner. Tech feels like it was all a scam to convert other people’s money into the company owners account legally.

This is an excellent observation. I had not thought of this angle. Ironically, a lot of customer-facing tech is based on selling your data, while you get to use an app supposedly for free. As a user, you are the product. Companies sell your data to other companies. Big John rightly points out that the people building these apps were also the product, i.e. a means to an end as the size of the engineering department was used to justify sky-high valuations, which led to higher incomes and bonuses for executives. You can keep stacking this tower of craziness. Investors were incentivized to produce high valuations, as these led to successful IPOs or mergers. Thus, for the investor class, the company executives, including its founders, were the product. On each level, people were lining their pockets, thinking they are making out like bandits, without realizing that by far the biggest payoff was there for the guys with the money sacks.

I briefly want to add a note on the customer being the product. I think that people are not generally aware of how extensively their data is being harvested and how often it is sold. It is quite likely that any app you use sells your data, i.e. either data you enter or data you produce while using the app, for instance movement or browsing data, is sold to thousands of others companies. The scale is truly mind-boggling. The other day an app I use updated its terms and conditions, and the email contained a statement about their x,xxx “trusted partners.” The number was so unbelievably high that I had to do a double take.

Another aspect is that the myth behind tech that the silicon valley elite tried to build has collapsed under its own weight. We have all heard that “software is eating the world” or that we will have self-driving cars “next year”, or that AI will cause a wave of unemployment among radiologists. These claims have not come true. We now know that engineers are not quite the geniuses we were supposed to believe. The value they deliver is not really there.

There are two observations regarding the supposed “rare skill” of being a software engineer. I agree that there is some work that requires a well above-average IQ. However, the field has been flooded by mid-wits who only cause extra work. Basically every software product I use has ridiculous issues. There are a few bugs in macOS that cropped up a few years ago, which never seem to get fixed. Android is so intelligently designed that it just triggers a restart when there is an update, no matter what you do. This means that as long as you do not unlock your SIM card and your phone, you are not going to get any alerts, and your alarm will also not ring. A late-night update can thus lead to you sleeping in. This is mindbogglingly stupid, but I am sure it has absolutely nothing to do with Google hiring non-technical people as “product managers”.

We are at a point where people would be happy if Google search would not shove DEI down their throat. Nobody is even seriously asking about self-driving cars anymore. Well, the crowd as moved on to claiming that ChatGPT is making humans obsolete, but the enthusiasm had died down a bit recently. Well, this is not going to happen either anyway. Arguably, DEI initiatives led to the implosion of tech, and via process that is not widely acknowledged. Let me explain: Getting through a degree program in Computer Science is not trivial, just like any other serious engineering program. Even people outside of STEM readily acknowledge that engineers may not have social skills, but nobody dared to say that they are not intelligent. However, you cannot keep engineers on their pedestal, however modest it may have been, if you simultaneously attempt to flood the industry with utterly unqualified people. Political activists, often supported by the silicon valley elite, pushed the narrative that everybody can and should code. In order to prove that, they put Shaneequa in a six-week coding bootcamp and forced Google to give her a cushy six-figure job.

There was so much diversity hiring in tech that the talent pool got incredibly diluted. Once critical mass had been reached, the claim that engineers are somehow smart or possess some kind of rare talent was no longer believable. It was still true that there were few good engineers, but it is not possible to push both narratives at the same time. If low-IQ Shaneequa is, after a six-week bootcamp, as good an engineer as some IQ120 nerd who taught himself assembler programming at the age of seven, then programming is not a rare skill. So what is it: Can anybody code or is programming such a rare skill that is justifies sky-high salaries?

Probably the single most important event in the dismantling of the tech myth was Elon Musk’s takeover of Twitter. He fired 6,000 employees, about 80% of the entire staff. Strangely, Twitter is as good as ever, and arguably in a better shape than ever before. This was the ultimate proof that tech is absurdly bloated. To be honest, I am not sure why Twitter needs to have 1,500 employees when Telegram has less than 100. This is not a typo. Keep in mind that Twitter has only about 350 million monthly active users whereas the corresponding figure for Telegram is around one billion.

One a side note, I can tell you from my own experience that a lot of people in tech do not do a lot of work. They have non-technical managers who do not really understand what their team is working on, so Joe does his work for the week in two hours on Monday morning, provides some bogus status updates during the week, and finally submits it (“commit” is the tech lingo) on Friday. The rest of his team mates may be in on it and work just as little as he does. I also know of cases where developers stopped working completely. They still went through the motions, i.e. attending the occasional meeting and bullshitting a bit, but they did not write a single line of code, albeit this was their job. An extreme case that happened in a company I worked at involved an engineer not committing any code for over six months, and if the manager of that guy’s manager had not gotten suspicious and snooped around, this could have gone on for longer. I am not sure he even got fired for that, because that was at a time when developers were supposedly really hard to hire, even those who did not do any work.

Silicon Valley elites managed to dupe investors and, by extension, the rest of society. Now that the party is over, the world has learned that tech companies are fine with just a fraction of its employees. Unfortunately, hordes of people went into computer science in recent years, and they will encounter a rather unfavorable labor market. There may be another bubble, but I find that doubtful. One issue is that, to modify a phrase I used above, software has already eaten a lot of the world. Tech is pretty mature, and has been for a long time. Furthermore, the Internet and smartphone land-grabs are mostly over. There will still be economic opportunity, but I do not see how the impact of the two key events of the last 30 years in tech can be replicated. Again, I am referring to the late 1990s, i.e. the consumer-adoption of the Internet, and the early 2010s, i.e. smartphones and the Internet in your pocket. There are no untapped industries that have not gone online yet, and smartphone adoption is close to 100%. Of course, there is always a new generation, but that is not the point as there will not be any kind of explosive growth with every new generation of teenagers getting their first smartphone.

Techies used to get paid a lot because the people with the money thought they needed them, and lots of them. Surely, they did not really understand what these guys were doing, but they did something important with computers. Thus, they thought that the more of these rare geniuses they got, the better the businesses they are funding will be. Then, everybody became a techie, even if they barely managed to set an alarm on their iPhone. This worked until the bloat was so high that you could fire 80% of people without any negative consequences. Now the people with the money know that perhaps they do not need all that many people. This is the new baseline. Aggressive hiring in tech is over and will be for a very long time.