Where did all the jobs go?

7/5/2025

Quick look at reasons behind the tech job dry ups, driven by economics, AI, and tax changes.

The tech job market has dried up faster than rain on a hot summer day. The days before and during COVID are long in the past now. It’s like looking back at an oasis that slowly disappeared, making you wonder if it was ever really there. So what exactly happened? Was it all just a mirage, or did the days of recruiters flooding your LinkedIn inbox simply dry up forever? What the hell happened?

There likely isn’t a single answer, but there are 3 big forces that hit once.

1. The Economy was a speeding car that finally slowed down, and fast

• Inflation and high interest rates made companies tighten their belts.
• VC funding dried up. Startups that were once hiring like crazy suddenly froze, or withered away.
• Layoffs swept through tech, from startups to the big FAANG companies.

2. AI - “AI replaced me!”

• Tools like ChatGPT and GitHub Copilot are automating work that junior devs used to handle.
• Teams can now do more with fewer people, while moving faster.
• It looks like some companies are not even listing entry level roles anymore and just letting AI fill in the gaps.

3. Tech Tax Benefits Dried Up

• A tax law change that eventually kicked in during 2022. It hit tech companies, especially R&D (Research and Development)ones, right where it hurts: cash flow.

Wait, What Tax Law?

• Under the old rules, companies could fully deduct their R&D (research and development) expenses in the same year they spent the money. This was huge, especially for startups or SaaS companies spending millions building new products. But due to a provision in the 2017 Tax Cuts and Jobs Act, that changed.

As of 2022:

• R&D expenses now have to be spread out (amortized) over 5 years if done in the U.S., or 15 years if done abroad.
• If a company spends $1 million on U.S. R&D, they can only deduct $100,000 in the first year and not the full amount.

Why This Hits Tech So Hard

Tech companies, especially startups, often have little or no profit but high R&D costs. This rule makes them look more profitable on paper, which means higher taxes, even if they’re still burning cash. It shrinks available capital, discourages hiring, and makes risky innovation harder to fund.

Startups, SaaS platforms, AI firms — they all felt the crunch.

So Which One’s to Blame?

Honestly, probably all three.

But the tax change?

This was probably the last straw that broke the camel’s back and caused the perfect storm in the job market.

What can I do about the job market?

The job market’s rough right now, but you’re not stuck. Here’s what you can do to get ahead:

• Learn skills companies need: Focus on skills that aren’t easy for AI to do or that are really needed. You can find needed skills on job postings, and skill up in these areas when applying. Depending on skills, it might require a larger project or open source work to demonstrate the skill.
• Network: Reach out to your network, but also try to meet new people in your area of interest. You never know where a connection can lead.
• Be open to new paths: Don’t limit yourself to one job or industry. Sometimes the best opportunities are where you least expect them.
• Show what you can do: Don’t just say you’re good, prove it. Make a blog, share tutorials, build projects, anything that shows you’re serious and have the required skills.
• Don’t give up: It might take time, but keep at it. Being persistent is the best approach.

The market’s always changing. That means if you stay ready and keep moving, you’ll find your opportunity.