[efitz]

AI layoffs are very shortsighted IMO and should be viewed by investors as a sign of weakness in management or the business itself.

If everyone is going to increase productivity by some factor k per employee, then kx is the new norm of overall productivity of x employees.

If you lay off some percentage Y of your work force, then your expected gains will only be k(x(100-y)/100). In other words, you will not recognize the same productivity gains as your competitors that chose not to lay off.

Yes I realize it is more complex than that, because of reduced opex, but there are diminishing returns very quickly.

[fastforwardius]

There are productivity gains to be had by reducing amount of communication and internal layers IMO.

I believe there are also diminishing returns on new features/products (in general case). So you won't really need that many people.