Tech Workers Face Evaporating Financial Security as AI Transforms Industry

A car passes Facebook's Meta logo on a sign at the company headquarters on Oct. 28, 2021, in Menlo Park, Calif. (AP Photo/Tony Avelar, File)

SAN FRANCISCO - Throughout a nearly two-decade career, Susan Smith considered herself a winner in the American economic lottery. She moved easily between tech jobs, earning a salary of more than $500,000 in her most recent position, as a mid-tier executive at Meta. A single mom, Smith could afford two nannies and support her disabled son without financial worry.

But as Silicon Valley has pushed headlong into artificial intelligence and heavy job cuts, that security has evaporated. Smith once readily put in 70-hour workweeks, believing the tech giant’s apps benefited humanity and that her contributions were highly valued. That feeling eroded in her last role, helping executives train new “AI employees,” part of an internal mandate that managers treat AI systems as real team members.

She survived four rounds of layoffs at Meta, but in May, the company let her go.

Now Smith is confronting a job market that looks nothing like that era of plenty. Few positions are available in her field, and several places where she’s applied haven’t called her back. Her ex-husband, a designer at Meta who was laid off in 2020, eventually gave up looking for jobs in his profession. He now lifts boxes at a warehouse.

Since the Great Recession nearly 20 years ago, political and corporate leaders have hailed Silicon Valley as a bright spot of American dynamism as the industry sped away economically from the rest of the United States. Young Americans, particularly those at elite universities, flocked to tech over Wall Street and made computer science by far the fastest-growing large major at U.S. colleges since 2008.

Breaking into the ranks of Meta, Google or SpaceX offered a trapping of cushy excess and entrance to the Silicon Valley corporate religion that a random software widget could change the world.

By most objective measures, America’s tech capitals remain superstar winners of the economy. Only the workers say they don’t feel that way. Their ingrained optimism has given way to a feeling that a Hunger Games-level scarcity is now the new normal.

ADVERTISEMENT

Smith counts herself among the ranks of the disillusioned, though she said she’s not pessimistic about the technology itself. “I just don’t personally see the point of doing it just to make a couple of people quadruple trillionaires,” she said.

The sense of precariousness among America’s professional elite could be a preview of what’s ahead for the rest of the country as AI spreads. Silicon Valley techies are “are guinea pigs for what tech dudes want to do to everyone,” said Anil Dash, a technology entrepreneur.

At tech companies, leaders obsessed with winning the AI race have tasked their workforces of coders, lawyers and HR professionals with becoming the front line of that transformation. They’re being measured by how quickly they can automate their own jobs while watching their colleagues get pushed out in successive waves of layoffs. Layoffs.fyi, which tracks announced job cuts, counts more than 800,000 tech workers laid off since 2022, including large staff reductions in recent months at Meta, Microsoft, Oracle and Amazon. (Amazon Executive Chairman Jeff Bezos owns The Washington Post.)

“There’s this whole tranche of people who’ve been quite used to being among the most upwardly mobile in society who are all of a sudden saying, ‘Now I’m the guy on the street‚’” said Oliver Raskin, who founded Silicon Valley market research consultancy Signalcraft Insights and has surveyed attitudes in the tech labor force.

ADVERTISEMENT

In the early days of ChatGPT, Raskin’s surveys showed broad optimism, he said. Now he says he believes the sentiment has changed.

“All these people … with some of the most coveted and secure jobs in the upper-middle class … - these are the people who have done the thing that everyone has told them to do: Study hard, get these jobs and then you’ll be rewarded,” Raskin said. “And all of a sudden, they find themselves on the front lines of this transition.”

This existential panic is occurring during what should be a euphoric moment, as tech stocks continue their 15-year growth tear and a set of AI companies, including OpenAI and Anthropic, prepare to go public with stratospheric valuations. (The Post has a content partnership with OpenAI, the creator of ChatGPT.)

But unlike in previous waves of initial public offerings, the financial payoffs of the new IPOs will lift a smaller group of people to staggering wealth, industry veterans say. That’s leaving their already affluent peers worried about their own futures, exacerbating feelings of inequality and insecurity.

[AI is already reshaping U.S. politics at every level]

ADVERTISEMENT

The professional unease of Silicon Valley’s elite gives them something in common with American workers who have endured decades of eroding workplace security, according to labor market historians.

Autoworkers in the mid-to-late 20th century were that era’s technology workers, said Georgetown University historian Joseph McCartin. Manufacturing was considered core to the country’s identity and economic vitality, and auto jobs were considered stable, well paying and high status in many communities, he said.

It took about two generations beginning in the 1970s for autoworkers to really lose ground as assembly lines automated, said McCartin, who predicted that AI would hit white-collar work faster than that. “The rise of AI, especially, is bound to change the workplace radically,” McCartin said. “But the way it’s going to happen is similar to how technology transformed the auto industry.”

Ruth Milkman, a labor sociologist at the City University of New York, said that technology workers are getting a dose of what workers in other industries have long complained about: jobs that feel unsteady or rob them of autonomy. “Low-wage workers are used to it,” she said.

Code with Claude marquee sign at Anthropic's Code with Claude developer conference on Wednesday, May 6, 2026 in San Francisco. (Don Feria/AP Content Services for Anthropic)

Meanwhile, AI has transformed tech work into a cutthroat environment, where once-lauded skills are devalued. Companies are now factoring AI use into performance reviews; giants such as Meta, Amazon and the computer chip upstart Cerebras have used visual displays to rank workers by how much AI they use compared to their peers. This practice of using AI as much as possible is now being dialed back as the costly tech blows through company budgets.

People skilled at complex software programming have status and pride in their hard-earned craft, Dash said. But increasingly, coders - some of the most highly paid workers in the tech industry - express fear that automated coding is making some of their expertise irrelevant.

“They have a self-awareness that [their coding skills] will never matter in the world again,” Dash said.

Many layoffs at technology companies are probably a hangover effect from over-hiring in prior years, experts say. And they don’t account for a spotty recent increase in hiring in the information industry, which includes employment of software developers and jobs in media and entertainment.

Digging deeper, though, some economists say there are signs that Silicon Valley and other technology-reliant parts of the American economy have reached a turning point where they are growing without needing as many people.

The notion was encapsulated in a recent talk that ricocheted through group chats across the tech industry: In it, a partner at the start-up incubator Y Combinator heralded a new generation of AI-first companies that will only need human labor for “novel situations,” “ethical considerations” and “high-stakes moments.”

Gad Levanon, chief economist at the labor research nonprofit Burning Glass Institute, said that the number of hours worked in the information sector has dipped since 2022, while the sector’s economic output has increased by about 8 percent a year - more than three times the overall growth rate of the U.S. economy.

He says the data reveals a sea change in industries, including technology and finance, toward doing more work with the same or fewer people - one that is spreading to other professional classes.

“That’s the new reality for white-collar and tech-exposed work: output up, headcount flat or down,” Levanon said.

Anneke Buffone, who had worked on well-being and safety issues for Meta, left the company in December. (Bryan Anselm/For The Washington Post)

Anneke Buffone, a psychology Ph.D. who had been recruited to Meta to work on well-being and safety issues before leaving in December, said that programmers aren’t the only ones feeling squeezed.

“There’s just a lot of uncertainty, a lot of fear, a lot of people feeling like, if they get let go from this job, they might not find another one,” she said.

She described getting pushback from managers when she tried to explain that a particular AI tool was a waste of time. The system had so many errors that she needed to redo its work.

ADVERTISEMENT

But her bosses “were like, ‘No, keep using it more. It’ll just get better,’” she said. “There’s a feeling among management that when you voice that AI has all these problems, they don’t want to hear it.” AI, she said, makes “everything go so much faster. It creates this illusion that you can get all this stuff done. Much of the time you’re just babysitting the AIs.”

A 31-year-old tech start-up worker living in San Francisco, who spoke on the condition of anonymity for fear of professional repercussions, said that her engineering manager husband told her a few months ago that he needed to focus all his energy on becoming an “AI native” and requested that she take on almost all parenting responsibilities for the couple’s preschool-age daughter. She complied.

She described the experience as surreal, as he spent days, nights and weekends, locked in his office toiling away on AI projects. But her husband eventually thanked her: He was now the top user of AI in his company.

Still, the couple, who earn a combined income of $550,000, say they feel woefully behind their friends, many of whom work at OpenAI and Anthropic and are expecting big payouts when their companies go public. “I have this dream house that I see on Redfin but I know I won’t get to it because Anthropic people will get to it first,” she said.

A longtime venture capitalist, who spoke on the condition of anonymity to speak candidly about her financial circumstances, said she and her husband were priced out when looking for a home in San Francisco in the $3 million price range. Many of the homes in her price range bid up to $7 million and $8 million, leading locals here to refer to a “mansion shortage.”

What’s happening in Silicon Valley is a turbocharged version of the division in the American economy between superstars and everyone else.

Superstar companies such as Google, Amazon and Meta won a concentrated share of their markets - and tech stocks have accounted for nearly half of the surge in the S&P 500 since the end of 2010, according to S&P Global Indices. Superstar cities, including in the Bay Area, generate far more economic output per worker and thrive relative to low-productivity ones. About one third of the total personal wealth in the United States is held by the top 1 percent of households, while the bottom half of Americans holds less than 3 percent, according to Federal Reserve data.

Raskin, who has worked in the tech world since the late ’90s, said that even though the current moment feels unsettling to many, he’s hopeful that it’s an early chapter in an evolving story. “It’s happened many times before,” he said, “that something implodes and all these people lose jobs, but then that talent gets cycled into whatever the next thing is - into a new wave of prosper

[truncated for AI cost control]