Tech Hiring May Slow Amid Recession Fears. Can AI Help?

“You may be looking very hard at AI from a standpoint of doing more with the people you have.”

April 14, 2025

With recession fears looming as the Trump administration’s tariff threats roil markets, enterprises are trying to preserve profit margins by curbing expenses — including payroll.

Tech jobs across industries fell by 29,000 jobs in March, according to analysis by IT research firm CompTIA. AI offers a tool to fill some of the gaps.

“This is going to force organizations to think hard about their strategy and the levers they have to control the business from a standpoint of profitability and growth,” said John Schneider, chief marketing officer at Betterworks.

Though it’s unlikely that AI is at a point where it can entirely replace existing workforces, said Schneider, the tech is already changing the way many people work – and potentially the way enterprises are hiring.

In a memo to employees, Tobi Lutke, CEO of Shopify, instructed staff this week that before any new hires were brought on, they would need to prove that the job couldn’t be done by autonomous AI agents.
“Can it slow hiring? Without a doubt,” said Schneider. “If you’re going to try to be efficient and drive profitability while your costs are going up … you may be looking very hard at AI from a standpoint of doing more with the people you have because of the efficiencies you’re realizing.”

However, companies taking the route of AI replacement over augmentation do themselves a disservice in the long run, said Schneider. Though enterprises may get short-term benefits from automating work that could be done by greener, less experienced employees, doing so could choke the “supply chain of talent” long term, he said. “They lose those people that were supposed to be the senior engineers in 10 years.”

Plus, while there are a handful of tasks that AI is particularly good at, there are plenty of areas where “human thinking can’t be replaced,” he said, such as soft skills like emotional intelligence, communication and decision-making.

“(AI) has the potential to be part of an antidote in how companies compete,” said Schneider. “I think that antidote has less to do with replacing the humans you have, but rather augmenting them.”