If the industry is to shrink this is the best way it can. Stop people entering while they are young and can pivot into something with better returns. Keep the experienced people who are older and may find it harder to pivot and had some "good days" to help them ride them through these bad times. I've seen similar dynamics in other industries as they slowly die/move on (e.g. manufacturing, niche trades, etc). A slow decline is better than a boom/bust. If it ends up that we need software engineers later training is an easier problem than mid career death for the juniors in a few years time.

Eventually the market finds a new equilibrium of staff to demand ratio. You prefer that happen sooner so people don't make bad investments of their time (e.g. studying the wrong course based on inaccurate market signals).