I have never understood the logic of responding to downturns with layoffs. It seems to me magical thinking to expect that earnings will increase when you reduce your productive capacity. It's like responding to being in debt by saying "I'm going to work less to cut back on expenses." Tim Bray cites 'the Kansas experiment' showing that tax cuts and government workforce reductions made it more difficult, not less difficult, to address financial issues. The same with companies. You have all this qualified staff and infrastructure just sitting there, and instead of figuring out how to make money with it, they just let it go. So wasteful. And now companies think they can cut their way to grown using AI. Now at this point it's still an experiment, the way Kansas was before they ruined it. But it's not just that that the experiment is likely to be a failure, it's that with AI they could have (say) doubled their capacity, and they chose to just lay off half their staff instead.
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