A few months ago, a software developer in the US lost his job. His role had been offshored. His manager, he later admitted, had not been straight with him. It was his first job out of college, and the experience left him feeling as much relieved as blindsided — he hadn’t realised, until the door swung shut behind him, how toxic the environment had actually been.
What he did next is where the story gets interesting. He didn’t update his LinkedIn headline. He didn’t email recruiters. He built something.
“I didn’t want to make finding a job my whole purpose in life,” he wrote in a post on Reddit’s r/EntrepreneurRideAlong subreddit that caught the attention of thousands of readers. So he spent the months of rejections building a product — partly to keep his skills sharp, partly because the alternative, grinding through absurd technical screening rounds for roles he wasn’t sure he wanted, felt like a waste of the one thing the layoff had accidentally given him: time.
“Yesterday,” he wrote, “he launched.”
He is not alone. Not even close.
The Numbers Behind the Shift
The scale of the US tech layoff wave since 2022 is difficult to fully absorb. According to TrueUp‘s live tracker, 245,953 tech workers were laid off globally in 2025 across 783 companies. In 2026, the pace has accelerated to roughly 963 workers per day. Layoffs.fyi, which has tracked cuts since the pandemic began, puts the cumulative total since 2022 at well over half a million jobs. Meanwhile, data cited by IEEE Spectrum from the US Bureau of Labour Statistics shows overall programmer employment in the US fell 27.5 percent between 2023 and 2025 alone — a drop that has no modern precedent in the industry.
| Year / Period | Workers Laid Off | Companies Affected | Key Context |
|---|---|---|---|
| 2022 | ~93,000 (US) | — | Correction begins; mostly startups initially |
| 2023 | ~200,000 (US) | 1,193 | Big Tech enters; Meta, Google, Amazon cut deep |
| 2024 | 152,922 (global) | 551 | AI restructuring named as driver; Intel, Cisco lead |
| 2025 | 245,953 (global) | 783 | Startups now account for ~60% of all cuts |
| 2026 (YTD) | 90,524+ (global) | 214+ | 963 workers/day; Microsoft, Oracle among latest |
| 2023–2025 | US programmer employment down 27.5% | Sharpest recorded decline; AI cited as key accelerant | |
The Market That Broke the Script
For most of the previous decade, the calculus for a laid-off software engineer in the US was simple: update the resume, hit the job boards, and land somewhere within weeks. The market was hungry, salaries were climbing, and technical talent moved freely. That equation no longer holds.
The post-pandemic correction reshaped everything. Meta, Google, Amazon, Microsoft, and Intel — names that once defined career stability — have collectively shed tens of thousands of roles since 2022. Some cuts were framed as efficiency drives. Others arrived with the quiet explanation that AI had simply made certain positions redundant. According to recruitment firm Indeed, the four roles most commonly eliminated in AI-driven restructurings are software engineers and developers, QA engineers, product managers, and project managers — essentially, the backbone of most tech companies.
The fallout hit entry-level engineers especially hard. Entry-level hiring at the 15 biggest tech firms fell 25 percent between 2023 and 2024 alone, according to data from SignalFire. New graduates found themselves competing with mid-career professionals, taking jobs below their previous levels just to stay employed. The job market, as that Reddit developer described it, became a system of rejection after rejection — not because candidates weren’t capable, but because the pool had grown impossibly crowded.
“What nobody predicted was that the biggest impact by far would be on programmers.” — Hugo Malan, President, Kelly Services Science, Engineering & Technology Unit (via IEEE Spectrum)
The structural math is straightforward and brutal. Codesmith analysis puts the number of tech layoffs since 2022 at over 300,000 — flooding an already competitive market with experienced engineers applying for roles below their previous grade. Some large firms cut active job postings by up to 90 percent compared to 2022 peaks. Offshoring accelerated the squeeze further: research cited by DistantJob suggests hiring offshore software engineers can save companies 40 to 70 percent compared to US-based equivalents, and GitHub projects that India’s developer population will surpass the US by 2028.
The Quiet Entrepreneurial Shift
When the job market breaks down, not everyone waits for it to repair itself.
The Wall Street Journal first flagged the phenomenon in 2023, calling them “revenge startups” — laid-off tech workers who, instead of returning to corporate employment, channelled their frustration into building companies of their own.
Y Combinator saw applications surge by 20 percent in its Winter 2023 season, crossing 20,000 submissions, even as it funded only 282 startups. The pipeline of founders was clearly expanding faster than the pipeline of funded companies.
A survey of over 1,000 laid-off tech workers who went on to start companies, conducted by Clarify Capital, found that professional growth — not desperation — was the primary motivation. For 40 percent of respondents, the idea to start a company came within six to twelve months of being let go. The top emotions reported were surprise, excitement, confidence, and optimism.
| Data Point | Finding | Source |
|---|---|---|
| Primary motivation to start up | Professional growth (not financial necessity) | Clarify Capital |
| When the idea came | 40% within 6–12 months of layoff | Clarify Capital |
| Top emotions post-layoff | Surprise, excitement, confidence, optimism | Clarify Capital |
| Entrepreneurial remorse | 70% went through a period of regret | Clarify Capital |
| YC Winter 2023 applications | 20,000+ applications, up 20% YoY; 282 funded | Y Combinator |
| First-time founder success rate | 18% build a lasting business | Exploding Topics |
What’s different now, compared to earlier waves of startup formation, is the infrastructure available to a solo technical founder. Open-source tooling, AI copilots, no-code platforms, and cloud infrastructure that scales from zero have collectively reduced what once required a team of five to something one developer can ship in months. According to TechStartups, the lower barrier to building — powered by these tools — has created what observers are calling a new generation of independent builders. What began as a reaction to layoffs is quickly turning into a structural shift in where founders come from.
The Structural Forces Behind the Trend
Two forces are running in parallel, and together they explain why this wave is different from previous cycles of tech unemployment.
The first is the compression of the traditional developer job market. Conventional full-stack roles — the ones that dominated a decade of hiring — are shrinking. Codesmith data shows demand for traditional full-stack positions has dropped by roughly a third since 2020, while the share of AI and ML roles in the total tech job market went from 10 percent in 2023 to 50 percent by 2025. A developer who spent years building conventional enterprise software finds herself structurally misaligned with what the market now wants — which makes the leap to building independently feel less risky than it once did.
The second force is the changing profile of who venture capital is willing to back. Investors who once required a pedigree — ex-FAANG, prior exits — are now signalling openness to a broader field of builders, particularly those who can demonstrate they know how to do more with less. As TechStartups observed, the best founders of this cycle are the ones who built during constraint, not abundance. Resilience beats hype.
What It Means Beyond the US
For investors and founders watching from India — where the startup count now sits at 493,000, second only to the US globally — the pattern carries implications that extend well beyond American labour statistics.
The wave of technically sophisticated, cost-conscious US founders building bootstrapped SaaS tools means more competition in markets that Indian B2B startups have traditionally targeted: mid-market companies, SMBs, and niche enterprise verticals where a solo technical founder can often underprice an established player and outmanoeuvre a larger team. A developer who has built a product solo, with no payroll and no office, operates at a cost structure that most funded startups cannot match in the early stages.
At the same time, the offshoring trend displacing American developers is the same trend creating technical talent depth in markets like India, Eastern Europe, and Southeast Asia. The global startup economy, valued at roughly $3.8 trillion, is being reshaped by a simple dynamic: the cost of building has collapsed, the frustration with employment has peaked, and the gap between the two has never been easier for a single skilled individual to step into.
“The 2025 layoffs are freeing up thousands of skilled professionals who no longer want to depend on corporate stability. Many will start companies of their own — and some of those will define the next decade.” — TechStartups
The Hard Part Nobody Talks About
None of this is clean. The Clarify Capital survey found that 70 percent of founders who started companies after layoffs went through a period of entrepreneurial remorse. The emotional whiplash — from being told you are family to receiving an automated termination email, then pivoting to building alone — is real. So is the financial pressure. Most of these founders, like the developer on Reddit, are working from a personal savings runway with no revenue and no certainty.
He launched. He has no paying customers yet. He is asking the internet for ideas. He is at the hardest point of any founder’s journey — past the build, before the proof.
But he shipped. In a market where the default response to rejection has historically been to send another application into a void, he made something instead. That decision — repeated by thousands of engineers across the US right now — is producing a generation of founders who didn’t choose this path so much as get pushed onto it.
The most interesting companies of the next five years may well trace their founding story back to a Slack message, an offshored role, and a developer who decided the job market wasn’t worth the wait.
