Everyone thinks AI is responsible for the wave of tech layoffs. The reality is more structural: the era of cheap capital ended.
For almost a decade, near-zero interest rates pushed investors up the risk curve. Venture capital flooded the tech ecosystem, companies hired aggressively, and organizations added layer upon layer of management, coordination roles, and internal complexity. When money was essentially free, few companies had to ask the hardest question in business: who actually creates value here?
Now that capital is expensive again, that question has returned.
In this video, I tell the story of a former Amazon director I met on a ski lift at Mt. Bachelor who was recently laid off. At first glance, his story sounds like the narrative everyone is hearing right now: AI replacing workers. He had built an automation system using AI that could re-engage tens of thousands of small business accounts.
But when you look closer, the automation itself wasn’t new. Systems like this have existed for more than a decade in tools like Eloqua and Marketo. The real reason he lost his job wasn’t AI—it was a return-to-office policy.
His story reveals a deeper pattern inside large tech companies.
During the cheap money era, companies massively expanded headcount. Amazon doubled its workforce between 2019 and 2021, while revenue per employee dropped significantly. Organizations grew more political, more risk-averse, and slower as layers of internal coordination multiplied.
Now that capital is expensive again, those layers are being cut.
Economists call the outcome a K-shaped economy: after disruption, some people move upward while others fall behind. The dividing line is not intelligence or talent—it’s proximity to value creation.
People who own processes that generate revenue, protect margins, control distribution, or build systems move upward. People whose roles depend on organizational layers, titles, or presence inside a company become vulnerable.
The real shift happening in the economy is the collapse of abstraction—the distance between the person doing the work and the person paying for the value is shrinking.
AI is accelerating this trend, but it isn’t the root cause.
The real question every professional should ask is simple:
Do you own a process that directly produces revenue or protects margin?
Because the future belongs to the people who do.