AI Companies Are Burning Billions, Tech Workers Are Getting Wrecked —And Wall Street Doesn't Care

The U.S. tech labor market has been trending downward for some time now. After a hiring spree post-pandemic, 2022 and 2023 saw cutbacks across major firms—and even as tech stocks rebounded on AI dreams, employment never really followed.

AI companies are burning through billions like it’s Monopoly money, and the actual people who built this industry are getting absolutely wrecked.

The Elephant In The Server Room

The tech employment market has been declining since early 2022—yes, before ChatGPT was even introduced. However, after OpenAI's rise and the AI hype, the gap between capital flows and actual hiring became impossible to ignore. Firms were still investing heavily in AI labs, yet hiring broadly froze, even outside of the sector.

Then, mass layoffs doubled in 2023, and at least 150,000 workers at tech companies were laid off in 2024 alone. By mid-2025, tech job postings dropped 36% below pre-pandemic levels, and the trend is expected to continue.  

While we didn't get the NFP data today, the August numbers were dismal, showing only 73,000 jobs added, with massive downward revisions. Eventually, President Donald Trump ousted the head of the Bureau of Labor Statistics over alleged "distorted" labor data.

"Important numbers like this must be fair and accurate, they can’t be manipulated for political purposes.” Trump wrote on Truth Social.

Meanwhile, the poster child of this turmoil is hemorrhaging cash at a rate that would make a VC weep. The company lost approximately $5 billion in 2024, despite generating $3.7 billion in revenue. Meanwhile, its H1 results are $4.3 billion in income and an astonishing $13.5 billion in losses, TechinAsia reported.

Yet somehow, they just closed a secondary share sale at a $500 billion valuation—making it the world’s most valuable startup. The math isn’t mathing, but the market doesn’t care.

Reshuffling The Tech Employment

Regionally, the carnage has been uneven but brutal. Tech postings in Boston plunged 51% compared to pre-pandemic levels, while Austin “only” dropped 28%. Still, the jobs that are being posted tell the tale.

Machine learning engineers saw postings increase by 59% from early 2020, while traditional software developer roles—the bread and butter of tech employment—declined by 49%. Traditional roles—such as Android, .NET, and iOS developers—have experienced significant drops, often exceeding 60% from their early 2020 levels, according to the HiringLab report.

Mid-tier developer jobs? Down over 60%. The message is clear: if you’re not building the AI, you’re being replaced by it.

Meanwhile, unemployment rates for young tech workers have climbed above pre-pandemic levels, and promotion rates in tech have slowed more than in any other major sector. Even if you have a job, moving up is nearly impossible.

The Sluggish Outlook

With Trump’s firing of the BLS commissioner and ongoing attacks on economic data integrity, markets are increasingly turning to alternate data sources—because who needs official statistics when you can just… make it up?

The Chicago Fed’s National Activity Index and other indicators now carry extra weight, but with government shutdowns threatening data collection and political interference becoming normalized, we’re flying blind.

So, if the FED might be forced to make further rate cuts in the dark, relying on incomplete or compromised data, why would the job market get better? Why would the companies boost hiring, especially to young graduates who are yet to stake their claim on the job market in this environment?

For households, it means not knowing whether the “strong economy” narrative is real or just a perception. For investors? Well, they’re already betting half a trillion on a company that loses money on every customer.

The labor market is sluggish, data is politicized, and AI companies are burning cash faster than they can count it. However, on the stock market, everything appears to be fine.

The golden age is here. Just don't ask the people who used to have jobs building it.

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