Who is At Risk Of Losing Their Job In 2025
How to Prepare for Tomorrow as an Engineering Leader - part 1
2024 is slowly coming to an end. It’s a period when I recommend all leaders pause and reflect on the past year, celebrate some wins with the team, and summarize all the lessons learned.
Here, however, I would like to explore what’s ahead of us in 2025. In this two-article series, I invite you to review trends, data, and personal experiences to consider how to better prepare for the coming year and secure our success as engineering leaders.
Are There Black Clouds Over the Tech Sector?
As dramatic as it may sound in the news, I don’t think there is any major crisis ahead of us—those working in IT. But we must keep adapting to an ever-changing reality.
The tech sector is currently navigating a complex landscape caused by economic challenges, evolving job markets, and the potential for innovation-driven growth.
The technology industry has faced significant hurdles over the past few years, including high inflation and rising interest rates, which led to workforce reductions. According to layoffs.fyi, there were over 260,000 layoffs globally in 2023, followed by almost 150,000 job cuts in 2024.
Even though this sounds scary, there are some signs of optimism in 2025. For example, The Computing Technology Industry Association projects that tech jobs in the U.S. could grow from 6 million in 2024 to 7.1 million by 2034 (source). By 2026, more than 90% of organizations worldwide will be affected by the IT skills shortage (source).
Layoffs and a shortage of IT workers sound like a contradiction, but this also gives us a hint—companies don’t need more employees; they need the right employees. The need for “talent density” (coined by Reed Hastings from Netflix in the book No Rules Rules) has never been as high as it is now.
After the 2020 hiring boom, followed by the recent layoffs crisis, many companies and their executives realized that organizational complexity due to headcount is also a key factor of success. The “10x engineer” is not a myth—given access to a global talent pool and the right tools, the gap between low and high performers can be truly significant.
Software engineering today is very different compared to 5, 10, or 15 years ago. We must acknowledge that the IT industry can be very lucrative for those on the cutting edge but brutal for those who lag behind.
Let’s see who falls into the latter category.
Who Is at Risk of Losing Their Job in 2025
There are three IT worker profiles at the biggest risk of losing their jobs in the coming years:
Software Testers – especially those who work in a factory-like quality checker role.
Programmers – people who write code just for the sake of writing it.
Transactional Managers – leaders whose main job focuses on allocating and scheduling “resources.”
Software Testers
According to the World Economic Forum, Software Tester jobs are predicted to decline by at least 15% globally over the next five years.
Manual testing, handoffs between devs and testers, waiting days for a “green light” from a QA organization—there’s no longer any justification for that in companies aiming for commercial success. Software engineering is different from manufacturing of physical goods. In development, if test automation is hard, it must be considered a bug (architecture, coupling, separation of concerns, missing interfaces/APIs, docs, etc.).
A successful tech company today can continuously iterate over its product, delivering changes even multiple times a day. This is the only way to keep up with market demand, validate ideas quickly, keep customers happy, extend the product, and add more edge cases to the existing feature base.
No matter how well-structured your QA organization is, automation is impossible to compete with. DORA research shows that high performers deploy multiple times a day, can recover from issues in less than one hour, and can deliver meaningful change to customers in one day. Stripe, in its annual letter 2023, mentions having 1.4 million tests.
With such pace and scale, there’s no space for manual testing, QA <-> Dev handoffs, and code freezes. If people in your company still do this, there’s no better time to start helping them transition into a regular engineering role (either as a Software Engineer or QA Engineer).
For more data and reasoning behind the transformation of software testing, check: Do You Need More Testers or Better Tests?
Programmers
Here, the situation is not as clear-cut as it is with testers. WEF’s The Future of Jobs Report 2023 says that Software Engineer jobs are expected to increase by 20–30%. Why should we even worry if there will be plenty of work for each of us?
At the same time, development is getting easier, no-code platforms are growing, and AI generates more code for us. Software engineering (at least its basics) is no longer specialized knowledge available to only a few.
This means that software engineers' skills and contributions may be perceived as interchangeable, especially by non-technical executives. Some aspects of software engineering may be moving toward commoditization due to:
The rise of Generative AI, automation, additional layers of software abstractions, and no-code platforms: We constantly get new tools like better IDEs, open-source libraries and frameworks, and SaaS platforms.
Global market dynamics: thanks to remote work, companies can outsource tasks to regions with lower labor costs, making it easier to find cheaper alternatives for software development.
Software engineering commoditization is a hot topic.
It’s true that today it’s easier and cheaper to outsource WordPress landing page management than to build it in-house. Much of the software complexity is moved to vendors (e.g., cloud platforms like AWS, GCP). Generative AI and publicly available frameworks make it possible for indie developers and solopreneurs to build million-dollar solutions independently.
On the other hand, the ability to understand complex systems, identify user needs, and create elegant solutions remains a critical skill that likely will never be commoditized. These factors will become a clear differentiator between mere coders and software engineers.
So how do you know if a software engineer acts—and is seen—as a commodity “resource”?
It starts with the assumption that it’s the PM’s job to provide all the answers. Coders don’t care about the problem the company is trying to solve; they focus on closing assigned tasks. They don’t know how their product is being used, assuming it’s the Product Manager’s or Analysts’ job to know. They don’t see ownership as an integral part of their work.
Such programmers, who don’t blend technology with business context and deliver “features” rather than solutions to real problems, are replaceable and can be the first candidates for layoffs. And it’s not always a matter of budget cuts. The larger the headcount, the bigger the management complexity. Often, parting ways with some of these individuals can be beneficial for an organization’s simplicity and “talent density.”
For more thoughts about software engineering as a commodity, I recommend checking out Figma’s CTO article: Why are we so afraid of code as a commodity?.
Transactional Managers
2024 was especially challenging for engineering leaders, who seemed to be targeted by this year’s layoffs. Reductions in 2023 and overall simplifications in engineering structures led to redundancies of first-level leaders who suddenly had nothing more to manage.
The subject was widely covered by
of The Pragmatic Engineer, in his article The end of 0% interest rates: what the new normal means for engineering managers and tech leads.Engineering manager roles were either reduced, or their responsibilities changed. Many moved to more hands-on positions, while others had bigger teams to manage. In his letter, Amazon's CTO mentioned “increasing the ratio of individual contributors to managers by at least 15% by the end of Q1 2025.”
According to LeadDev’s The Engineering Leadership Report 2024:
Engineering leaders are being asked to do more than before, with 71% of respondents reporting an increased scope or broader remit.
35% are working longer hours than before, and just 6% are working less.
Finding suitable positions is proving challenging for 59% of respondents.
The data suggests that our profession is undergoing an inevitable transformation. The engineering manager role is being redefined, similar to the roles of testers and programmers.
So, who is likely to lose their jobs in 2025?
These will be transactional leaders whose main job is allocation and scheduling. Their primary way of improving productivity is by hiring more people. While increasing headcount is sometimes inevitable, today’s high-performing leaders address expectations management, transform their working environment, and bridge the gap between product and engineering.
Leaders who micromanage (only assign tasks and block collective decision-making), avoid contributing to product discovery, lack sufficient technical knowledge and hands-on experience, or work as gatekeepers (“give me all requirements or my team won’t work on it”) are the ones who will either be at risk of losing their jobs or heading toward burnout.
Why is that? Check the LeadDev data: 35% of leaders work longer hours, and 71% have a wider scope. In my past article, I also mentioned that “only 10–30% of features pushed by companies bring positive results.”
It’s clear that organizations are seeking ways to optimize productivity. Micromanagement, where you stay on top of everything, doesn’t scale. There are limits to how much cognitive overload you can handle. You can’t just work more hours. That’s why you must look for better initiatives that clearly pay off—and then help your teammates do the same.
Leaders who don’t will be the first to let go.
Compound or Go Home
What do the testers, programmers, and transactional leaders mentioned in this article have in common?
They often overlook the fact that their jobs scale poorly if approached linearly. If a single test takes 3 minutes of a tester’s time, 100 tests require 5 hours of continuous work.
Software complexity constantly grows—if you don’t manage it proactively, a task that took you one day today will take twice as long in the future. Building the wrong features also has a cost: not only do they bring no value, but you also have to maintain them (read more: Ten Types of Software Engineering Waste).
If you micromanage a few people, doubling the team size will make your brain explode.
The only way to thrive in software engineering is to constantly find ways to compound the outcomes of our work. This can be automation, re-architecting, shifting complexity (to vendors, frameworks, libraries), or managing your people through a center-out leadership approach.
Great engineering is not about working harder; it’s about finding ways to make our lives and work easier. The best-spent hour today is the one that will save you days in the future.
These actions distinguish testers from QA engineers, coders from software engineers, and managers from engineering leaders.
The Engineering Leader of 2025 and Beyond
No matter how good 2025 may be from an economic perspective, layoffs and cost optimizations are inevitable.
Of course, high-performing people can also lose their jobs due to circumstances beyond their control. But if you keep in mind the difference between coders and engineers or transactional vs. transformational leadership, it’ll only be a matter of time before you land a decent job again.
If you aim to achieve more than just securing your current position, I invite you to continue exploring. While some of the techniques described above sound universal, there are also specific leadership challenges relevant to today’s realities—from AI adoption to redefining metrics of engineering success to the changing landscape of the global workforce.
In next week’s (and the final) article of this year, I will explore a few themes critical for engineering leaders who want to be successful in 2025 and beyond.
Stay tuned!
This is a fantastic breakdown of the challenges and transformations we should all expect in 2025! Success next year will truly belong to those who prioritize long-term impact over short-term gain.