The reasonable assumption is they believe a recession is coming.

Honestly not a bad theory. There’s definitely a huge disparity between actual productivity gained by using agentic coding done somewhat properly… and a non-stop wave of vibe coded work causing outages and churn. Pre-Covid hiring coupled with the high enterprise pricing for AI plans, it would make sense.

If you listen to people on HN you could think AI is not increasing productivity or is even having a net negative effect.

I think the reality is different.

In this thread I saw the resume of an engineer affected by this Cloudflare layoff. In the resume he claimed that adopting opencode in his workflow, he shipped an integration in half the time it took peers without AI assistance for similar projects.

infrastructure changes slowly. once its built its not clear what you are paying 1111 people for.

It is May 2026, there is no difference between AI and non-AI bills.

Most (if not all) major enterprises in the US have gone through at least one round of org-wide subscription renewals (eg: Atlassian product packs, Microsoft product packs, etc) where 1) price increases were mandatory, 2) AI features could not be opted out of, and 3) AI feature usage was strongly encouraged from C-suite to client-facing biz staff to telephone agent support staff.

I repeat, we are passed the point where AI bills and non-AI bills can be differentiated. We are all paying for these features driven by tokens whether we like it or not, whether the cost-benefit analysis makes sense, and whether they are even being used.

And we are all passing the costs onto everyone lower on the totem pole, from insurance groups to bank groups to national grocery chains to consultant conglomerates to minimum wage front-line staff to below-minimum-wage gig workers.

And this is why there are layoffs, every price increase from the top down causes further price increases to cascade down.