My Honest Thoughts On The Software Engineering Market In 2024

Here is a summary of the key points from the transcript: - The software engineering job market is very tough right now, especially for those with 0-5 years experience. There is a lot more competition due to layoffs and hiring freezes. - The speaker believes the golden era of software engineering jobs from 2015-2022 is over. It used to be easy to get a high-paying software job, but now there are more barriers to entry. - Interest rates going up in 2022 meant companies became more defensive with spending and hiring. This led to layoffs and hiring freezes in tech companies. - AI and automation may reduce the need for as many software engineers at companies. The speaker argues this point though, saying AI won't fully replace engineers. - Despite the negatives, the speaker still believes software engineering is a good career path for those looking to make good money and have work-life balance. But it is just harder to break into now than before. - The speaker recommends focusing on improving your skills rather than worrying about external factors you can't control. Use resources like AlgoExpert to prepare for interviews.

What's up, everybody? How's it going? In this video, I'm going to share my honest thoughts about the current software engineering market in 2024. I figure that the best way to do that is to share first my unfiltered negative thoughts about the software engineering market in 2024, and then to share my unfiltered positive thoughts about the market right now. And then we can kind of combine the two thoughts together and come to a conclusion. So with that said, I have to give you a warning. The first half of this video is going to be quite negative. So if you're kind of feeling down right now, if you're struggling to get a job or something, I would encourage you to watch the entire video because the first half is definitely not going to motivate you or make you feel any better. It's going to probably make you feel even worse. But I do think that this is the best way to share my honest thoughts about the market. So with that said, the negative thoughts about the software engineering industry right now, what is so negative about it? Well, to put it simply, I think it comes down to right now is a brutal time to find a job as a software engineer, particularly for the software engineers that fall in the bracket of no work experience, all the way to four to five years of work experience, which is basically senior software engineer at that point. So very, very brutal to get a job as a software engineer, especially in that bracket. And what makes this even worse, the really depressing part of this is that, honestly, I don't think it's going to get better anytime soon, if ever. Like, there's a world where it doesn't get better than right now. Now, in order to understand why it's so brutal right now, we have to rewind the clock a little bit and go back to the golden era of tech, which I'd like to think is like the 2010s, but particularly the latter half of the 2010s. So let's say 2015, 2016 and beyond, all the way to 2022 and going back there, I'm going to share very briefly my story, how I got into tech, because it's very relevant here. I got into tech after I graduated from college in 2016. I had never written a line of code. Many of you know this. I had a degree in math, and I remember the few jobs that I had applied to that had nothing to do with tech, nothing to do with software engineering. They were all offering, like, the sort of advertised salary ranges were somewhere between, like, $40,000 to $60,000 a year. And this was in New York City, mind you, which is a high cost of living area, arguably the highest cost of living area in the United States. And I remember I had some friends who were like the same age as me, just graduated from college but with a computer science degree, who were landing jobs that were paying $110,000, $120,000, $130,000 a year in Silicon Valley. And I was like, okay, wait, what is going on here? And that's why I decided that I needed to learn to code. I went to a coding boot camp for about three months, learned to code, really enjoyed it, and then got a job at Google, which is right around the time that I founded my company, Algo expert. And the key point here is that I was not the only person to do this. There were many other people who did this at the same time as me and then after me, after 2016. So in 20, 1718, all the way through 2022, more and more and more and more people did the exact same thing. Now, not all of them were new grads like me. Many of them were in other industries. You know, they were like 2510 years, 15 years into their careers, and they were like, oh, I'm not making a lot of money, or I just don't really enjoy my job. And they sought this opportunity in tech, and so they flocked to it. It was this feeling of, you know, there is easy money to be made out there. Easy good money, not like bad money, not small money, a lot of money to be made out there with a low barrier to entry. I have to get in. And so over these, you know, the second half of the 2020, 2010s, decade into 2020 and beyond, you had hundreds of thousands of developers that flocked into the industry. And the industry, meaning the companies, you know, software engineering companies or companies hiring software engineers, welcomed them with open arms. They hired most of these people. And the reason they did is because back then, everybody was hiring. Can you imagine that? Back then, there was at least, supposedly there was a shortage of software engineers. Like, I remember when I got in the field. And during the few years after I got into the field, you kept hearing that there was a shortage of software engineers. There were not enough software engineers to fill the demand from companies. Like, companies were hiring too many rules needed to fill too many positions, and there weren't enough software engineers or at least qualified software engineers. Very hard to imagine, like right now in 2024, when everything seems so bleak, but it's okay. You had all these people who flocked into the industry, and the industry accepted them. So everything was great. All sunshines and rainbows until early to mid 2022. Why? What happened? In early to mid 2022, interest rates in the United States and in many places in the world started to go up. And so that meant that slowly but surely, slowly but suddenly, money became very expensive to borrow. Money became very expensive to raise. And so what do companies do when money becomes hard to borrow? Money becomes more expensive to borrow, hard to raise. They start to be much more defensive of their money. Suddenly, money matters. Suddenly, it matters that you're profitable. If you're a big company, it matters because you want your stock price to keep going up. If you're a small company or like a startup, it matters because if you're not profitable, you die. If you can't raise money. Right? And so what these companies did is they started to cut costs. You know, we need to make sure that we can make money, that we can make a good amount of money. We cut costs. And so they stopped hiring. They stopped, or they slowed hiring, but a lot of them stopped hiring altogether. And then on top of that, many of them did layoffs. So what happens when so many companies stop hiring and do layoffs? Well, you've got the entire cohort of, like, new up and coming software engineers from 2021 to 2022 ish that can't find a job suddenly. And then you've got the entire, like, you've got a huge amount of software engineers from the cohorts of, like, 2016 all the way to 2022 that get laid off. So they get thrown back into the market, and they also need to find a job. So suddenly, you've got all these software engineers competing for the few jobs that are still available. Cause we have to clarify, like, it's not like everybody stopped hiring. It's not like there were no more open software engineering positions completely whatsoever. No, there were still some just way fewer, I think, at the bottom of the market. I think there were, like, 70% or 65% fewer open jobs compared to the top in, like, early to mid 2022. But so suddenly, you've got all these people competing for very few positions, and boom, there in comes the brutality of the current software engineering job market. And what makes it really particularly tough is that, like, you, like, for people who have no work experience, who only have, like, one to two years of work experience, they're competing against people of their own level, but they're also competing against people who have three, four, five, maybe even six years of work experience. Because think about it. Imagine you're like, a senior software engineer at Google and you got laid off in one of the Google layoffs, and now the only job that you can find is at, let's say, a startup, okay, a startup called XYZ. And that startup XYZ is only hiring for one software engineer. And that software engineer is going to get paid $150,000 in, let's say, California. Okay, well, for that senior software engineer from Google who used to be making $350,000 at Google, that is an entry level software engineering role, at least based on salary. But if it is the only software engineering role that he or she can apply to and get, then they're still going to go after it, right? And so all of a sudden, all those entry level people or junior people, they're competing against that senior person for the same job, which makes it really, really brutal, very brutal to land an interview, very brutal to sometimes even find the open jobs because a lot of companies, they don't even need to put their job posts on like, open job boards because they get flooded with applications and instead they can just like, go to their internal existing software engineers and just get referrals like that. But then it's a lot harder also to pass the interviews because if you've got, let's say, like a thousand people applying for one job or 10,000 people applying for one job, you narrowed down to, like, I don't know, 50 people. And then of those 50 people, they're all interviewing for that one position. And so the bar to pass is much higher. And, yeah, it's all around brutal. Now, of course, if you do get one of those highly coveted interviews, you want to make sure that you prepare and that you do very well because that's going to be your one shot at landing that job. So here, of course, I'm going to recommend that you check out my company, Algoexpert. Algoexpert IO. We've got the best software engineering interview prep materials across all disciplines, like coding interviews, systems design, machine learning, front end, definitely check it out. Infrastructure iOS. Algoexpert IO. Use a promo code, Clem CLM for discount on the platform. But so, as we just said, yeah, very, very, very brutal market. And the reason that it's not going to get better anytime soon and perhaps ever, which to me is the, is the more negative part of this entire story, is that companies have kind of realized that they're not really worse off now with, you know, half as many software engineers than they were before. And here, to be honest, I think there's a few components at play one of the components is that particularly in the big companies, like fan companies, Google, Meta, Amazon, a lot of them throughout the 2010s, they were in their hypergrowth mode. Now they've been alive for like, 2030 plus years. And some of them are really reaching, like, maturation, where it's a lot more kind of like maintenance, improve the existing systems and products, which may or may not be the best strategic way to keep the company going. But the point is, if they're not in super hyper growth mode, they may not need as many software engineers as they needed before. And then also, the other component to this is just that you don't need that many software engineers. I think a lot of companies back in the 2010s, over hired. They saw everybody else was hiring and they were like, okay, well, we need to hire two. Especially, like, in the startup world, it was like, to raise money, you had to say that you were gonna be hiring 100 people or 200 people, which is just complete nonsense. If you know anything about software engineer, you know that past a certain threshold, you start to lose productivity. So the fact that so many companies have realized that they're basically better off with fewer software engineers really doesn't help. And then on top of that, on top of that, you have two letters that got sprinkled into the mix and that didn't make anything any better. And these two letters are AI, artificial intelligence. I think that we all knew that AI was coming, like, during the 2010s. You know, I kept hearing, like, machine learning, machine learning AI. But it's really in 2022, with the launch of Chad GPT, that things just started to explode. And then year after year, month after month, it's just been absolutely insane. And AI has gotten to the point where there's an argument to be made that maybe it's going to obsolete software engineers altogether. This morning, I saw another video of someone demoing an AI tool that was doing front end engineers work, building a website with a one paragraph prompt. And it's actually legitimately pretty good and impressive and responsive design and actual clean uis and cool UX and all that. But even if it doesn't completely obsolete software engineers, it's certainly making them way more productive. And so the idea is, like, if your engineers are suddenly doubly productive, do you need as many engineers, or can you just cut your software engineering workforce in half? You know, maybe you can cut it in half. And so I think that that's not helping. You know, like, the whole AI thing, fear is not helping with the current job market for software engineers. And it's certainly not helping with the psyche of software engineers that thought that you have in the back of your mind of like, am I going to be completely obsolete within like five years or three years or one year? Given the pace of AI? That's not helpful. And so, yeah, those are my honest negative thoughts. We're going to get to the positive in a second. Those are my honest negative thoughts on the current software engineering market in 2024. Now let's get into the positive. I know that was a lot of negative. If you made it this far, what would be a positive emoji? Let me look on my phone like, what's a positive emoji? Okay, if you made it this far in the video, just put a party emoji. So whether it's like the confetti or like the little emoji that's like blowing the party thing or like a balloon, just put one of those emojis. If you made it this far in the video and I'll try to heart it, that'll tell me that you made it through the negative part of the video. So the positive part of the video. Okay, what are my positive thoughts about the industry? Well, first and foremost, companies are still hiring flat out. Just gotta say, like, there are still jobs out there and a good amount of them. Anecdotally, I can tell you that I've been contacted numerous times now by recruiters at meta and Google asking me if I wanna come back to work there. Now granted, I worked at those companies, so they're asking me if I want to come back. But still that means that they're hiring. And excuse me, the most recent of these emails was just like a month ago, I think, or two months ago. And I also had one of my friends, he was my coworker at Google. He joined Facebook right after I did. He's still there, you know, like four, five years later. Now. He got promoted. And he just a week ago told me that like, if I ever wanted to come back at, you know, meta, his team has headcounts, so they're hiring. Um, and just, you know, again, anecdotally speaking, I've heard from a lot of people that meta is hiring and actually quite aggressively within the context of like the current market, but they are hiring quite aggressively. So, um, you know, companies are still hiring. There's a lot of pockets in the world that are hiring. Like, just because one industry has been really badly affected doesn't mean that all industries have been badly affected. Remember during the pandemic, you know, some industries were really, like destroyed while others were thriving. And by the way, like, you know, during the pandemic, tons of people got into software engineering, right? Because it was so easy you could do it remotely. But so here, you know, one example that I gave in a recent video, I'll give it again, is like the blockchain industry, crypto industry. They're hiring a lot. Two companies that come to mind are Coinbase and Chainlink Labs. They're both remote companies. They're both, you know, really like leaders in the space. And they're hiring. So if you're a software engineer, go check out their career pages and many other companies in that space. And just in general, like, I don't know, like airlines, you know, maybe airlines are hiring or maybe credit card companies are hiring. You just gotta look around, right? And you will find some open jobs. Now, the second thing that I think is not all doom and gloom and is actually quite positive is AI. I will take the reverse side of that argument before that. I don't think AI is something that you should fear. I really, really don't think that AI is going to replace software engineers, even though I will concede that AI is extremely impressive and the pace of advancement is like starting to make you feel like, huh, it's going to be able to do things that I never thought were conceivable before. However, I don't think it's going to replace software engineers, at least not anytime soon. Like, not in the next five to ten years. And, you know, the best point I can give you is like, you are delusional if you think that a sane, rational, competitive business is going to risk getting rid of all their software engineers and replacing them with AI. That just makes no sense. The risk of that, the risk of suddenly you have a bug that is unfixable, where your entire website or company goes down and you can't do anything about it because you just have an AI that is stuck is just ridiculous. I really don't think that AI is going to completely replace software engineers. And even the whole thing about, like, it makes them so productive that suddenly you need fewer engineers. I don't think that's like quite accurate. I think that maybe for a few companies, for some companies where it's like, hey, we really only need one or two software engineers, and if they have AI, we truly have no reason to hire a third engineer. Okay, fine, maybe those, like AI, will have a bit of an impact. You'll get only two, two workers instead of three. But I think for most companies, especially, like the ones that are in a hyper growth mode and that are constantly trying to beat out the competition and everything. You want your workforce to be as productive as possible. And so if all your engineers, you've got ten engineers and suddenly they're ten x engineers, great, you're going to have 100 x the productivity and you're not going to just cut them in half. There's always more work to be done. And this brings me to another point, which is software engineering is not going anywhere. I think some people are just leaning too much into the doomerism, like software engineering is gone. Software engineering is a dying industry. No, that's akin to if you had said 1000 years ago, 400 years ago, 100 years ago, that construction workers weren't going to be needed in the future because you would be able to build things way quicker and everything. No, you're just going to build more things and so therefore you're going to need more and more construction workers. I feel like there are more construction workers right now than ever before. So I think the same is going to be true for software engineering. I think the field is not at all going to die. It's still going to thrive and keep on thriving. And I guess the final sort of positive thought that I have here is overall, I think that it is very pointless for you to let, it's very pointless for you to let these external things that you can't control, like interest rates or like AI, lead your life. So instead of worrying too much about these things that you can't control, why don't you worry about the things that you can control? You can control how hard you study computer science. You can control how much time and effort, effort you put into networking and into applying to jobs. You can't control how much time and effort you put into preparing for coding interviews or systems design interviews or whatever. Algoexpert IO you can control all these things. And so why don't you just try and focus on being the best version of yourself, out competing everybody and getting that one position that has tons of competition around it. It's still doable. There's going to be someone who gets that position and it's not always going to be the person with the most work experience. So you should grab control of your life. You have your own agency. You are in control of your own destiny for the most part. Now as sort of like final thoughts, mixing the negative and the positive together. I will say that overall, I think that the golden era of tech as we knew it in the 2010s, particularly the second half of the 2010s is probably over. I think that the, like, back then, it was the golden era because it was the easiest, meaning that the least amount of, like, barrier to entry, the highest paid and the most, like, relaxing and with the best work life balance. Career out of basically any career, in my opinion, and I think in a lot of people's opinion, which is why you had so many people jumping into it now, the only part that I think is not true is, like, the barrier to entry. It's no longer the easiest barrier to entry. Like, it has some barriers to entry, which is like, there's a lot of competition right now and there aren't as many open jobs as there used to be, but it's still very high paying, it's still very chill. Like, very good work life balance compared to most other industries and all things considered, I think is just software engineering. Engineering is now more of a normal, typical career that has pros and cons, high paying, great work life balance. You know, all things considered, you're not really, like, exhausting yourself during the day when you're, you know, a software engineer, but it's tough to get. It's tougher to get than it was before. I would still recommend to someone who's like, 18 or in their twenties who doesn't know what they want to do with their life and just wants to make, like, good money, have a good life. You know, I would still say, like, get into software engineering. I don't think that there's a. A better path than software engineering. Despite the fact that it's tough to get into software engineering right now, particularly as an entry level developer, I still think it's the best career path. So these are my honest, unfiltered thoughts on the industry right now in 2024. Let me know what you think about my thoughts in the comments below. Do you agree? Do you disagree? Do you have any thoughts that you want to share? Definitely. Let me know in the comments. And don't forget to smash the like button. Really helps me out. Subscribe to the channel if you haven't already. Follow me on all my other social media and I will see you in the next video. Bye.