More Software Companies, Fewer Engineers per Company

Sabrina Ramonov reconciles two data points that seem contradictory: big tech companies are laying off engineers in waves, yet the total number of open software engineering roles is increasing. Her explanation is that the industry is restructuring, not shrinking. The future has more companies building software, each with smaller teams.

Why Big Teams Ship Slowly

At a large tech company, shipping a small feature requires an idea, an entitlement calculation from product managers, a system design, and a spot on the roadmap. That process can take months. The overhead scales with team size and organizational complexity.

On a smaller team, an engineer who sees a problem or opportunity and understands the product can build and ship a feature without that chain of approvals. This was already true before AI tools entered the picture.

AI Makes Small Teams Even More Viable

A single engineer with strong product sense and AI-assisted development tools can now build and ship faster than ever. The economics of software have changed: products that would not have been profitable to build with a 20-person team become viable when one or two people can do the work.

This opens the door to a new class of software businesses. Hyper-local apps for specific cities. Tools built for niche communities. Products that serve small markets which were previously too expensive to address. The cost floor for building software keeps dropping, and that means the minimum viable market size drops with it.

What This Means for Engineers

The net effect is positive for software engineers as a profession. More companies building software means more total jobs, even if each company employs fewer engineers. The roles shift toward people who can wear multiple hats -- engineering plus product sense, engineering plus domain expertise -- rather than specialists slotted into a large team's assembly line.

Key Takeaways

• Large companies are shedding engineers while total open engineering roles are growing; the distribution is shifting toward smaller teams
• Big company shipping processes have always been slow; AI makes the contrast with small-team velocity even starker
• AI tools lower the cost floor for building software, making niche and hyper-local products economically viable for the first time
• Engineers who combine technical skill with product thinking are positioned best for this shift