Why AI hasn’t replaced software engineers, and won’t

Drawing on economic data, surveys, and software engineering research, the authors argue that AI-driven mass layoffs in software engineering are largely a myth driven by 'AI washing.' Most high-profile layoffs attributed to AI were actually caused by financial pressures or investor demands. The core argument is the 'decide-execute-deliver sandwich': AI compresses the execution layer (writing code), but the decision-making and delivery/accountability layers resist automation for structural reasons, not just capability limitations. Evidence shows AI caused an 8x increase in lines of code but only 30% more releases. The distinction between 'vibe coding' (unsupervised, low-accountability) and 'agentic engineering' (human-supervised, accountable) is critical — companies cannot ship production software by replacing engineers with vibe coders. The authors are cautiously optimistic that demand for software engineers will remain strong or even grow, as cheaper software creation drives more software consumption (price elasticity), though individual career trajectories may still be rocky.