Introduction

Tech layoffs are a familiar cloud hanging over one of this century’s fastest growing industries. Pandemic-era hiring sprees were followed by scything cuts on oversized workforces sparking concern among software engineers about long-term career stability.

2023 was the harshest year on record, with over 260,000 tech jobs cuts. While the end of the year showed faint signs of recovery, with an increase in hiring of 11.6% between July and December, the layoffs continued into 2024, with 237,000 layoffs across 1,107 companies.

As the biggest household name companies defined global perceptions of the ruthless hiring market - Meta cut 13,000 employees and Amazon 18,000 in 2024 - the nuances behind the numbers are not as well understood.

Many aspiring technologists now believe there are simply no more jobs for software engineers, a sentiment that has spread far and wide, but the real story of software engineering jobs in 2025 is far more nuanced.

Layoffs Are Declining, and AI Is Fueling a New Hiring Wave

As of March 2025, layoffs have decreased significantly - 22,692 tech employees across 81 tech companies. This year is projected to see 190,972 total layoffs, a massive drop from 429,608 in 2023.‍

Meta leads the pack with 3600 layoffs, followed by Hewlett Packard with 2500. Data shows that companies at the top of the tech food chain, who over-expanded rapidly in 2020-21, continue to stabilize their numbers, but that companies are actively recruiting engineers at all levels. 

This rise in hiring is partially a result of new AI tools that offer companies across all sectors the opportunity to transform their productivity and products, increasing appetites for engineers proficient in AI and ML to maintain the new systems being implemented.

This trend is expected to persist. According to the US Bureau of Labor statistics, the software development sector is expected to grow 17% by 2033, one of the fastest growth rates across all occupations.

‍Ark Nigay, a software engineer at Twilio and Codesmith alum, says that Twilio is hiring “hundreds” of software engineers as a result of the AI boom.

“AI is replacing manual labor—not skilled engineering”

says Ark Nigay, a software engineer at Twilio.

“We laid off hundreds in customer support, then hired hundreds of AI engineers and front-end developers to build intelligent systems.”

Who’s Really Being Laid Off in Tech? It’s Not Engineers

The myth that software engineers are the main victims of layoffs is misleading. The reality? Most cuts are in non-technical departments:

• In February, Google reduced its People Operations (HR) teams
• Amazon laid off staff in its Communications & Corporate Responsibility team
• Microsoft and Meta both reported restructuring efforts targeting operational layers, not core engineering roles
  
  “Companies are letting staff go so they can reinvest in employees with AI-related skills”

according to TechFinitive, and this could be a moment of enormous opportunity for software engineers expanding their technical capacities to cover the implementation and maintenance of AI infrastructure.

Senior Microsoft engineer on the Xbox team and Codesmith alum, Will Kencel says

“it's never been an easier time to become a 10x engineer because of the resources available”

adding that

“jobs that are more menial and require a lower cognitive ability will get replaced. Jobs where you actually need more cognitive ability, like maintaining systems, will grow.”

It’s a sentiment echoed by Victor Janulaitis, CEO of labor market research firm, Janco Associates, who explained that tech companies are retaining their tech teams, but non technical project managers, middle layers and those performing “administrative” tasks were more at risk.

Underperforming teams and discontinued products in engineer layoffs

Engineers are predominantly affected by layoffs when part of a company team is underperforming in comparison to other teams, or a key company product gets discontinued.

PlayStation’s Visual Arts studio laid off engineers in March this year after the cancellation of multiple live-service games, while its parent company Sony was forced to lay off around 100 engineers in 2023 who were working on underperforming video games.

Discontinued products continue to lead engineer layoffs, which make up a small portion of tech layoffs, rather than the rise of AI tools replacing humans, as is often discussed.

How Engineers Are Thriving in Today’s Hiring Market

Despite lingering fear, many engineers are not only surviving but thriving in 2025. Here's how:

1. Build Deep Technical Skills

Mateo Lopez-Castillo, a Codesmith grad recently hired by Meta, gave his perspective on the market and what aspiring engineers need to succeed.

Finishing Codesmith at the end of 2023, it took Mateo most of 2024 to navigate the job search and receive an offer from Meta.

“Codesmith definitely told us that it was going to be hard”

he says. But as soon as the Meta recruiter contacted him he set to work to get to the top of the pile by continuing to build the technical capacities that Meta were looking for.

“I had a good technical communication from Codesmith, but once I got in the loop for this role I dedicated all my time to grinding away. I practiced system design for hours a day, solving algorithms and dynamic programming techniques, whiteboarding all of it out and practicing everything out loud.”

2. Create an Open Source Project (OSP) That Demonstrates Expertise

‍Mateo says Codesmith residents should leverage their Open Source Projects to put themselves in contention for the engineering jobs they want.

“Meta told me one of the indicators they're looking for is not someone with surface level knowledge of something or who has read stuff online, but people with knowledge in something that junior engineers wouldn't know about or wouldn't be able to talk about.”

“You can focus your Open Source Project on a tool that junior engineers may have only heard about, but don’t have experience in using. Really explore it in depth in your Open Source Project and make sure you can talk about it in depth, not just regurgitate sound bites, but can speak with a level of detail that demonstrates your intent and passion.”

3. Apply Relentlessly

All engineers we spoke to said this market has an endless appetite for applications.

Ark from Twilio spent over five months on the job hunt and sent out “100s of applications” before he had even got his first onsite interview.

Mateo at Meta said he gave up counting how many applications he had sent, but that at last count, he’d sent over 1000.

“I was spending 15 to 20 hours a week submitting applications and it was frustrating. I spent a lot of time on LinkedIn looking at jobs posted in the last 24 hours so that I could be one of the first people to apply to it.”

Pro Tip: Avoid “easy apply” on LinkedIn. Prioritize external application links—they often yield higher response rates.

4. Understand the Hiring Cycle

“Hiring in tech is a cyclical thing,” says Will Kencel, a senior engineer at Microsoft Xbox. There’s a burst every December when budget approvals roll in. Be ready to move when the doors open.

Software Engineering Job Market: 2025 Outlook

Despite the noise, the outlook for software engineering jobs in 2025 is optimistic.

• AI is driving job creation, not destruction, especially for engineers with skills in AI/ML, infrastructure, and UI‍
• Layoffs are down, with the brunt of cuts hitting non-technical and administrative roles‍
• Hiring is up, especially at companies rebuilding smarter tech teams post-2023

While layoffs persist in certain areas, particularly for non-technical roles and underperforming products, the hiring market remains strong for skilled engineers. Persistence, technical depth, and strategic application efforts remain the keys to landing a job in today’s evolving tech landscape.

TLDR: Software Engineering Jobs in 2025

• Layoffs: Down significantly in 2025, with 22,692 layoffs in Q1. The total for the year is projected to be 190,972, a sharp decline from 2023’s 429,608.
• Who’s Affected: Most cuts are in non-technical roles (HR, communications), not engineers.
• Hiring Surge: Demand for engineers skilled in AI/ML and infrastructure is rising as companies implement new AI tools. The software development sector is expected to grow 17% by 2033.
• How Engineers Are Thriving: Engineers focusing on technical depth, open-source projects, and persistent applications are succeeding in today’s market.
• Outlook: The job market is strong for skilled engineers, especially those adapting to AI advancements.