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Comment by meragrin_ | Hacker News Reader

> * The Section 174 changes went into effect, requiring all software to be expensed as R&D, which means it can't be deducted from profits directly and instead has to be amortized over 5 years [0].

I get the short term initial issue. I don't see why it would be an issue to stick current level of staffing until it normalizes 5 years later. I'm not sure this was ever a major issue. It just seems like a convenient excuse to cover up something else.

Interest rates are obviously definitely an issue.

> this is not caused by AI.

It may not be caused by AI, but it is going to affect hiring numbers from now on.

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I feel like the 174 issues might be more painful for smaller teams? Like if almost all your costs are in salaries, and you bring in a new person, suddenly you're booking profits despite not having cash profits?

That was my understanding, at least. That R&D salaries make this all weird.

The Section 174 changes are terrible for startups, but yes, they're only inconvenient for established companies. Many startups won't even last long enough to amortize all of their dev expenses, especially if they owe taxes on "profits" earned during those first few years. The whole startup ecosystem (which is what this set of job listings is largely measuring) relied on being unprofitable and therefore untaxable.

> It may not be caused by AI, but it is going to affect hiring numbers from now on.

That remains to be seen. I can say with high confidence that we did not have tech that was capable of reducing the need for engineers from 2022 to 2024. It's hard to predict the future.

How many developer jobs are due to startups? I can't imagine enough to really affect the job market all that much. There's a lot of people out there looking.

>> It may not be caused by AI, but it is going to affect hiring numbers from now on.

> That remains to be seen. I can say with high confidence that we did not have tech that was capable of reducing the need for engineers from 2022 to 2024. It's hard to predict the future.

If I can run some small models locally which helps me significantly right now, I don't really think it is hard to make the jump to needing fewer engineers overall. I've seen people paying for the big models do even more.

> How many developer jobs are due to startups?

Out of the Who's Hiring thread on Hacker News, which is what this chart in TFA is measuring? I don't know, but I'm assuming a pretty big chunk.

We will see by how much. I seriously doubt it improves productivity by a huge margin; if I had to guess, it would be in the ballpark of 10-20%. In the end, it's not the main driver for hiring or lack thereof. Companies that will need to get stuff done and that will be able to make enough money will hire as much as they need to get it done.

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