Barclays cutting 5k jobs as it increases reliance on AI

So what I don’t understand about the whole AI layoffs story is, wouldn’t it be better to just get an insane amount done with the current resources? Like, in theory, absent massive collusion, wouldn’t the incentive structure be basically a prisoners dilemma where companies who use their existing resources to produce more will just easily take over market share from companies who use the opportunity to save on employee cost? From a game theory perspective I don’t get it. Does anyone have an explanation?

Like are the LLMs so expensive to use that they are just converting employee spend to LLM spend? If so, that’s still odd, because the LLM capabilities just represent a massive new investment opportunity, and I think the same game theory structure would still hold unless the companies had minimal cash reserve and minimal lower ROI investment areas to cancel first (and unless something changed recently many companies do have cash reserves and also I haven’t noticed experimental projects getting canceled outright to focus on ramping up the main project into areas previously unreachable).

On the other hand, money got a lot more expensive around the time the layoffs started, and that would force everyone’s hand at once to reduce expenses, and it looks a lot better for various parties if the reason is OMG AI and not a roller coaster monetary policy.

> Barclays also revealed it made £2.3bn profit in the three months to September, higher than the same period a year ago, but slightly less than forecast.

This is the critical piece of information, everything else is C-level noise and smoke.