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What awaits us next year and how can we summarize the past one? How will jobs related to technology change under the pressure of ai? Welcome to the fortune-tellers' section on Techsistence!
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As usual at the end of the year, we observe a surge of predictions and bold forecasts about the market and its upcoming condition. This time, the turn of the year represents a collision of two worlds: optimism associated with a "new beginning" and realism, which dictates increased caution. Unfortunately, the first of January does not open a completely new chapter in the economy or markets, and drawing conclusions should be supported by reflection on the past year.
Important data from 2023
The IT job market recorded a solid weakening, with the penultimate quarter alone seeing about 12,000 positions evaporate from IT. Most major companies reported waves of layoffs this year, especially at the beginning of the year. This situation is related to significant economic uncertainty: high inflation due to the money printing during the pandemic, turmoil around wars in Ukraine and Israel, but also the rapid development of technology, whose outcomes are difficult to predict. All this causes, on one hand, great caution, and on the other - a clear trend in changing the profiles of IT job advertisements, which are turning towards AI and next-gen software development. As usual, unstable times mean uncertainty for many, but also huge opportunities for some. Uncertainty is the new normal. These are a few key factors that CEOs point to as important trends:
We are tired
Although this statistic rarely finds its way into headlines, I believe it is critically important. Our well-being at work is one of the more important factors for growth, and lately, it has been very poor. In a study for McKinsey, nearly one-third of employees report symptoms of burnout or significant exhaustion:
Around the globe, employees showed symptoms of burnout, especially fatigue. According to a McKinsey Health Institute survey, approximately 20 percent of workers are experiencing burnout. In 29 out of 30 countries, more than a third of surveyed workers reported experiencing exhaustion in particular.
In my opinion, this has a direct connection to the uncertainty and market situation, but also to the mixed work model, which will stay with us forever, and to which some have not yet adapted. Indeed, remote work generally increases individual productivity, but it is difficult to predict the consequences for mental comfort.
Importantly and often misunderstood by employers, non-financial factors are the primary influence on such comfort, as well illustrated by the results of this survey. Note that more important than earnings are currently the opportunities for development, doing work that is meaningful (provides value), and the possibility of working from anywhere.
Inflation and rising living costs
Although salaries are steadily increasing, they are not keeping up with soaring inflation, which, although it is starting to slow down in most regions of the world, has had a significant impact on living comfort. The overall condition of the economy is of concern to me, especially if we combine the natural slowdown associated with emerging from the pandemic, money printing, a long period of zero interest rates, and attempts to artificially maintain the status quo through support programs, loan holidays, and other actions, which, although sometimes necessary, significantly weaken the economy in the long term.
Time to get down to Earth
The last few years in IT have been a land flowing with milk and honey. Unfortunately, it was also full of pathologies, especially in larger companies. Maintaining teams "just in case," or tolerating work on several jobs are extreme but real cases from a few companies I know. For the same reason, smaller projects had a hard time - attracting talent was next to impossible, and ensuring "market" salaries or reaching MVP required startups to acquire expensive capital and sell IP to VCs. Last year we observed a significant slowdown in VC investments, directly related to lower demand for work and slower salary growth in IT:
There is already a record-high demand for capital; in short, for every needed $3, the market offers $1. This means not only slower growth but also more expensive and harder-to-obtain capital.
The crisis, which is a complication of the difficult geopolitical situation and the exit from Covid, causes the normalization of these pathologies, but on the other hand, it is also overlaid by the AI revolution. Contrary to appearances, this is not a revolution that will free up new jobs. Quite the opposite. Although it is difficult to predict with a crystal ball, in my estimation, over the next few years, employment among IT professions we know will steadily decrease precisely because of artificial intelligence. This means worse times for the worker, but on the other hand, it gives enormous possibilities to the individual and will lead to the emergence of Freelance 2.0, where technologically aware people will be able to build huge advantages and deliver services to clients on an unprecedented scale. One thing is certain - the gold rush is over. And while normally I would say that this will benefit everyone in the long run, it is difficult to put forth such a thesis, considering that artificial intelligence will transform all companies, their structures, their department structures, and also reduce employment in the coming years. Although there is currently quite a bit of ignorance in this area, the next year will be a breakthrough in understanding and normalizing how AI can add value to enterprises.
David vs. Goliath fight
Interesting in 2023 was the clash of two worlds. On one hand, the hype and proclamation of AI (rightly so) as a revolution on the scale of the industrial revolution, and on the other, the worsening situation of companies and employees. So everyone says that IT is flying into space thanks to AI, but employees are slowly beginning to understand that it is flying into space without them. Or at least without their current skills. This means the need to adapt. Compared to 2022, where the economic effects of Covid were still not felt, and the direct effects caused huge increases in digital spaces (mainly e-commerce, but not only), what we observed in 2023 can be assessed as a slowdown. Additionally, the great caution of investors, and therefore the lack of new, pumped-up projects, has translated into stagnation in the job market. Although part of this comes from uncertainty, which will slowly disappear in 2024, other factors will continue to make the situation in the industry difficult. Nonetheless, the past year in larger, stable companies, rather reminds me of ignorance in relation to artificial intelligence and the lack of sensible attempts to transform processes based on AI. I hope that next year companies will realize that it is necessary to build competitive advantages in this field before it is too late.
What awaits us next year?
Mainly AI, which is probably no surprise. Next year we will also see another iteration of the VR trend, with a device from Apple, which is not yet mainstream, but sets a certain direction for new possibilities, applications, and interactions with technology. However, AI will undoubtedly remain the most important trend to watch and draw conclusions from the changes that are occurring there. It is the most important technology that has been created "in our times." It brings with it a lot of possibilities and threats. Probably, Blockchain and several related projects will also reappear in the trends, after Bitcoin's halving this year.
Perhaps this year, hardware and the combination of AI with the real world (robots, humanoids, new wearables, also in combination with VR and AR) will start to play a more significant role, although here it is possible that we will have to wait a little longer. I hope that education in this area will also be a trend, as staying up-to-date and trying to orient oneself in this changing reality will be absolutely crucial for people who currently work in IT, and whose professions will be transformed in the coming years.
What might happen?
For the first time, we are dealing with technology that is developing so fast (I'm talking about AI) that practically any predictions should be treated with caution. Not so long ago, we did not have either ChatGPT, GitHub Copilot, or Midjourney. In one year, these technologies have caused a huge stir in IT. But as usual, initially, it is only a stir, and little goes into concrete value and implementation. However, I am sure that next year we will observe a stage of slow "normalization" of AI, despite its continuous progress.
This means more specific use cases, interest from companies and regulators, gaining more popularity through increasingly better models run locally (offline) and open-source. We may also see the first appearance of AGI, but that is of course fortune-telling, and there is no point in dealing with things we have little influence over. Gradually, this will lead to a change in thinking about business models. The structure where a given department had 10 people may start to evolve, and at the end of the day, we may think about single-person, interoperable departments, supported by automation and artificial intelligence.
It is also worth mentioning an important threat associated with the dynamic development of technology and AI. The strongest companies currently participating in the AGI race are amassing record resources. The technology we create gives huge advantages to the largest because training models is a huge cost and requires access to microprocessors. The outcome of this race may be unfavorable for everyone because companies like Google or Microsoft are currently building huge advantages, which will mean they will dictate terms in the market in the long run. Key here seems to be adjusting legislation in terms of antitrust and regulating AI, and although I don't have too high hopes for this, we should at least be aware of it.
How the role of programmers will change
Generative AI, which had its global premiere last year, will have a tremendous impact in the future on practically all professions we know. This chart shows which industries will feel the consequences the fastest:
First and foremost, the role of programmers will change. But in the long term, the importance of IT-related professions as we currently know them will definitely decrease. However, it's hard to imagine that they will be completely eliminated in the near future. Skills that are more horizontal, not necessarily specialized, will become more significant.
It's about what to do, not how to do it.
Already, tools like Copilot demonstrate that most code will soon be written by AI. However, an operator will still be needed - someone who will control what code is written and for what purpose.
For now, it's hard to imagine this being a non-technical person. The greater the experience and understanding of code (as well as other fields like UI, UX, business, etc.), the better the results we will be able to achieve. This means that programming professions are evolving into operator roles, increasingly using low-code and no-code solutions to achieve their goals. Projects like BuildShip are undoubtedly growing in popularity, enabling the construction of ready-made applications from components in a process supported by artificial intelligence.
How to live (and thrive) in 2024?
Above all, awareness of the above changes will allow us to make better decisions and delve deeper into topics that potentially give us an edge. I believe this is the best way to secure ourselves in uncertain times: build advantages, mainly related to knowledge. However, I'm not talking about reading clickbait articles about AI, but rather about delving into the subject from a technical side, learning to converse with AI (prompt engineering), or the Freelancer 2.0 (no-code and low-code) trend I mentioned. These are times that can provide very favorable working conditions for a few, whether for oneself or someone else's account. However, adaptation is necessary, and the best thing we can do is to befriend the enemy.
Personally, I worked hand in hand with artificial intelligence throughout 2023 and can no longer imagine working any other way. The Alice application we created, which I use hundreds of times a day, can perform tasks for me, edit and translate content, and assist in daily work. Creating or adapting such an assistant should be everyone's task, leading to incredible advantages.
If this is to be accompanied by a New Year's resolution, I suggest learning from good sources for at least an hour a day in 2024. I am convinced that this is an investment that can pay off many times over!