For Software Engineers, the AI Reckoning Has Already Arrived

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1:45Carol Massar:All right, so we kind of want to stick with AI and trying to get to, I mean, it's part of almost every story that we get to. And a fascinating story, it's a most read on the Bloomberg, it's by our Business Week team, about how the reality of AI and its impact and AI reckoning, you might say, has already arrived for software engineers. And we want to get to this story. Mark Millian wrote it. He's Bloomberg Businessweek deputy editor, joining Tim and me right here in studio. You know, we talk about, first of all, great story. Thank you. Loved it. We caught our attention this morning on our read-in.

2:16Carol Massar:We talk about ROI and productivity gains. Coders, software engineers, they're already feeling the impact of what AI can do for their world. Maybe there's an upside, maybe there's a downside, but walk us through what's going on. Yeah, I used to live in San Francisco. I covered the tech industry for more than 15 years. I'm living here now working on Business Week, but I had just been hearing for the last six months from sources and old friends out there that this is like the biggest thing that's happened in their industry in at least 20 years. And I felt like I just had to go out there and see and just really understand what was going on.

2:54Because you hear a lot of doomers talking about how AI is going to take all the jobs. Right. And here they're saying that because it's taking their job or it's at least drastically changing their jobs. And so I went into Anthropic and OpenAI, spent time at the labs and just met with people who have been doing this their whole life, you know, their whole adult lives. learning to code coding and now you know they're not writing code anymore they're just having conversations with claude meaning they're vibe coding or something different well vibe coding because like there's not necessarily a name for this yeah they look at as a little of a derogatory term so that's more elementary that's for the folks like me who don't actually know how to code exactly okay uh and so there have been different terms for and most of them just call it coding even though they're not actually writing the code themselves.

3:45But yeah, it's like basically telling it what you would have spent the next six hours doing. It's like, here's how I want the app to be structured. Okay, so then what do they spend the six hours doing now? They spend the six hours building 10 different features for their app. And so they'll open separate windows and saying, like, you work on this, you work on this, you work on that. It's sort of like a product manager, which is a job that exists. But those people don't have people who are going to produce things as quickly, within 10 minutes, that would take a person a couple days.

4:20Carol Massar:Mark, tell us about Boris Churney out in San Francisco. He created the software Claude Code, runs it at Anthropic. And in your reporting, you say that at Anthropic, the expectation that everybody is at least a little bit of a coder has become endemic. And that mindset is beginning to infect much of the tech industry. Tell us a little bit more about it. I'm assuming you chatted with him. You talked with him. Yeah, I spent a bunch of time with Boris. he's a really interesting guy he's like a coder's coder and so he's like this a little bit of a guru that like people follow him on their podcasts and his ex posts just like figure out like what how is my job going to change tomorrow like anthropic is releasing stuff almost every single day um but he has you know like a long background in the industry he was the head uh the leader of code quality at meta so like he kind of set the standards for how meta developed facebook and instagram and worked on the server architecture at Instagram.

5:11And he's just sort of articulated what this new world looks like. And it's changing even for him every week. Instead of actually telling it what to do, now he just creates this broad framework for his AI and just like, go spend the next several days working on this challenge. What does this mean for what we've seen with the talent pipeline in Silicon Valley over the last 20 or 30 years or so? So it comes to mind, I was actually speaking with a Bloomberg intern. We have a great class of interns here. He's not on the media side. And I asked what he was studying. He said, well, I'm now studying cybersecurity, but I spent my first year majoring in computer science and programming.

5:51And he saw the writing on the wall. He decided to switch his major as a result. Yes. It's been a sea change within especially entry-level jobs in this industry. And it's still so new that it's hard to know how it's really going to shake out. There's plenty of optimists who say there will just be more demand than ever for software and people who understand how software fits together. I talked to somebody at Carnegie Mellon who's working on helping restructure their computer science program. But the early science have not been great. So since ChatGPT came out in 2022, coding jobs for people in their 20s is down 20%.

6:32Wow. And it's a lot of the first in, first out at the big companies. They're doing mass layoffs. Some of them are blaming AI when it's really maybe not AI's fault, and they just maybe overhired during COVID and are trying to correct that. But for a lot of companies, they're true believers that this is a new way of working.

6:52Carol Massar:Measuring productivity or ROI, though, is tricky. Even among these folks who maybe are finding they can, you know, Basically, use AI and talk to it and say, go for five or six hours and do something, and then maybe do another one somewhere else. But it's still tricky. It's true. Everything based on my reporting leads me to believe that this dramatically increases productivity for a software engineer. But finding actual data to support that has been very difficult. There's one study that was highly respected that took place early last year. Before AI coding was really a common thing and the models weren't as good, and they found that, well, people thought they were more productive, but they're not actually more productive.

7:36But there was this moment in time last November when Claude released a new model that really was capable of replacing parts of people's jobs, and ChatGPD followed with a similar model. They couldn't run the experiment again because most of the software engineers that went to, we don't want to hand code anymore. We've got a better way. We're not going to waste our time for your experiment. What's the thing now that you saw in Silicon Valley that still can't be done by Claude that people are having to do that maybe a year from now Claude will be able to do? There are some examples of people who are coding on very outdated hardware that had severe limitations that Claude, which is trained on incredible amounts of code bases to understand the best practices.

8:23There are very niche types of electronics that require a human touch, but for the most part, those people, they would use Claude, they would find errors, they'd fix those errors themselves, but they're still using Claude and Codex.

8:36Carol Massar:It's almost shocking how quickly we are here. I know we've been talking about three years, but it does still feel like pretty shocking. Glad we're still here. Right now. Sorry. Mark, thank you. Great story. Mark Millian, Bloomberg Businessweek, deputy editor. Check out his story. It's on the terminal.

9:19Carol Massar:take on the stories that matter. Listen to Bloomberg Daybreak each morning on Apple, Spotify, or anywhere you listen.