Laid Off in the Age of AI: Lessons Learned and the New Job Market Chaos

From Startup Grind to Layoff Shock

I recently went from being the Technical Specialist / Director / Fractional CTO of a small SaaS company to an unexpected layoff – and the contrast has been eye-opening.

In my startup role, I learned invaluable lessons about how small companies operate differently. There were fewer established processes, and culture often flowed directly from the founder. (As the saying goes, 80% of a company’s culture is defined by its core leaders review.firstround.com.)

In practice, this meant that working directly under the CEO could be a blessing or a curse depending on their character and leadership style. A supportive, decisive founder can empower the team, but a micromanaging or indecisive one can create chaos.

At the startup, we lacked the safety net of big-company systems. There was no extensive HR, no formal project management office, and often no clear guidelines – we were building the plane while flying it. This gave me a lot of personal freedom and broad responsibility.

Financially, the startup life was rewarding (an acceptable salary can go far), and I had the autonomy to experiment. However, it also left me “stuck between a rock and a hard place.” I could see major technical problems (like accumulating technical debt), and I knew how to solve them, but I often felt disempowered to act.

In a small company, if the CEO doesn’t prioritize refactoring or infrastructure, your hands are tied. We had massive tech debt – those quick-and-dirty code fixes piled up over time – and without strong processes like continuous integration or code review, it started slowing down innovation and frustrating the team. designli.co.

The experience underscored how important good processes and trust are: when founders micromanage developers, it holds back innovation and crushes morale (designli.co).

I learned that leadership and culture matter enormously in startups – the founder’s quirks become the company’s quirks, for better or worse.

All of these lessons were hard-earned and sometimes emotionally taxing.

So when I was laid off, it felt like a punch in the gut. But I soon discovered that facing unemployment in 2025 is a whole new challenge compared to a few years ago. The job market I’ve walked into is almost unrecognizable, largely because AI is transforming how people hire and get hired – and not entirely for the better.

The New Reality: Job Hunting in an Oversaturated Market

After my layoff, I expected that my full-stack development experience and CTO background would land me interviews fairly quickly.

Just a couple of years ago, it seemed like engineers had it easy – recruiters were constantly reaching out with opportunities. Now, that’s changed dramatically. My inbox is filled with automated rejection emails (some so off-base or garbled that they don’t even make sense), and getting a human response feels harder than winning the lottery.

It’s not just me: the whole tech job market is flooded. Recruiters on LinkedIn are openly talking about being swamped with applicants for every job post, and qualified people are slipping through the cracks.

Why does the market suddenly feel so oversaturated? I did some research and found there are a few big reasons:

  • Wave of Tech Layoffs: The past couple of years saw unprecedented tech layoffs. Since 2022, over 300,000 tech workers have been laid off (codesmith.io).

    • This means hundreds of thousands of experienced developers are out there competing for the same pool of jobs. The supply of candidates has ballooned virtually overnight.

    • Many of these folks have strong resumes (ex-FAANG, startups, etc.), so they’re tough competition and they’re also willing to take roles below their previous level or pay grade just to stay employed (codesmith.io).

    • That crowds out opportunities for others, especially junior developers who now find seniors vying for entry-level spots.

  • Shrinking Demand for Traditional Roles: At the same time, companies have pulled back on hiring in traditional software engineering roles.

    • The demand for generalist full-stack developers has contracted by about one-third since 2020 (codesmith.io).

    • After the hiring booms of the late 2010s, many firms realized they over-hired or are focusing on other specialties now.

    • So you have more engineers in the market, but fewer open positions for the kinds of roles I used to fill. It’s a classic supply-demand squeeze.

  • Everyone Applying Everywhere: The ease of online applications has removed a lot of friction from job hunting.

    • Remember when you had to tailor a resume and cover letter for each job and maybe even mail or email it? Now, with LinkedIn Easy Apply and similar features, people can (and do) send out dozens of applications in a day.

    • Online job boards made applying to jobs “easier than ever before,” which was already causing high volumes of submissions even before AI tools showed up (techspot.com).

    • One recruiter noted that application volumes were surging thanks to one-click job board submissions and a tight labor markettechspot.com.

    • In short, if it takes 5 minutes to apply, a lot more people will hit that button – including folks who might not be fully qualified. This means recruiters end up with hundreds of applications per listing to sort through.

  • Remote Work = Global Competition: The rise of remote work has opened up most jobs to candidates worldwide.

    • If I apply for a U.S. remote developer job, I might be competing with equally skilled developers in other regions who are also applying en masse.

    • The talent pool for each job is much larger than it used to be when location constrained the search.

  • Lean Recruiting Teams: Ironically, companies that laid off engineers also often downsized their recruiting staff greenhouse.com.

    • So while applicant volume went up, the people available to review those applicants went down. Greenhouse (a hiring platform) reported that in early 2024, their clients were seeing an average of 222 applications per job opening, nearly 3× the volume from just two years prior greenhouse.com. And those few remaining recruiters have to manage this deluge without extra hands.

    • It’s no surprise many rely on automated filters or quick rejections (hence those canned emails I keep getting).

This combination of factors created a perfect storm. To use a cliché, it feels like “too many fish, not enough ponds.”

There are more skilled people chasing each job, and each job posting becomes a magnet for way more resumes than any hiring manager really wants to deal with.

It’s demoralizing as an applicant – you feel like one drop in an ocean. I went from having offers thrown at me to screaming into the void.

How AI Made a Mess of Hiring (for Both Sides)

On top of these market factors, there’s another huge change since the last time I job-hunted: the widespread use of AI in the hiring process. And I don’t mean AI replacing developers (that’s another conversation); I mean how both job seekers and employers are wielding AI in the application and recruiting process. It’s turning into a bit of an arms race – and a messy one at that.

Here’s what’s happening:

Applicants Are Mass-Applying with AI: Job seekers (from new grads to experienced folks) are now using generative AI tools like ChatGPT to write resumes, cover letters, and even answer application questions. According to recent surveys, over half of job candidates are leaning on AI in some part of their applications techspot.com.

Capterra found 58% of candidates use AI tools to help in their job search and 26% have used AI to mass-apply to jobs greenhouse.com. I personally know people who use GPT to generate a base cover letter, then tweak it a bit for each job. In more extreme cases, there are automation scripts (“application bots”) that literally apply to jobs for you. One report described how someone could apply to hundreds of jobs in minutes with AI bots flooding LinkedIn ere.net.

In fact, a hacker built a tool called AI Hawk that applied to 2,483 jobs while the creator was eating breakfast ere.net! This is wild – it means one determined (or desperate) person can shotgun their resume everywhere with almost no effort.

Quantity Up, Quality Down: Not surprisingly, many of these AI-generated applications are low-quality. Sure, they’re formatted nicely and stuffed with the right keywords (AI is great at ensuring your resume mentions the exact skills a job description wants info.recruitics.cominfo.recruitics.com). But they often lack any personal touch or authenticity.

Recruiters have noticed that a lot of incoming resumes and cover letters sound formulaic and “robot-written.” One tech recruiter noted the influx of “bland” applications with the same generic wording – a dead giveaway of ChatGPT’s writing style techspot.com.

Hiring managers also report that many AI-penned cover letters feel impersonal or incomplete, sometimes even having awkward phrasing or mistakes that a human likely wouldn’t make resume-now.com.

The result? Instead of a stack of unique candidates, recruiters see a slush pile of near-identical, templated resumes. “Higher volume and lower quality,” as one recruiting platform CEO summarized it techspot.com.

Beyond blandness, some AI-generated resumes cross into misinformation. Candidates might oversell their skills or sprinkle in keywords for things they barely know, just to pass automated filters info.recruitics.com. (If a job posting wants Kubernetes, you can bet an AI-written resume will find a way to mention Kubernetes – whether or not the applicant truly used it much.)

Recruiters then face the task of sifting out fluff and verifying actual skills, which is harder when every resume is puffed up by AI. According to one survey of hiring managers, 94% have encountered inaccurate or misleading AI-generated content on resumes resume-now.com. So trust in resumes is eroding – every claim could be a hallucination by ChatGPT, and that means more work to vet candidates.

Recruiters Fight Back with AI (Bot vs. Bot): Overwhelmed by the flood, many recruiting teams have also turned to AI tools on their side. This includes AI-based résumé screeners and Applicant Tracking Systems (ATS) that automatically filter and rank applications. It’s become a bit of a “bot vs bot” showdown: AI-written resumes trying to game the system, versus AI-driven filters trying to catch the best candidates ere.net.

Companies are using algorithms to scan resumes for keywords, score cover letters, or even run AI video interviews where a machine evaluates your recorded answers. The goal is to cut through the avalanche of applications quickly.

However, this heavy automation has its own issues. For one, good candidates can get wrongly filtered out. If your resume doesn’t have the exact phrasing an AI expects, you might be auto-rejected without a human ever seeing your qualifications. (I suspect some of my nonsensical rejection emails were due to an algorithm deciding I wasn’t a match based on keywords alone.) Also, when everyone is keyword-stuffing their resumes (often with AI help), the ATS might pass a lot of unqualified people too. Recruiters then still end up with a bloated shortlist to manually review.

It’s telling that nearly 75% of U.S. companies use automated recruiting systems to screen resumes now, and at large companies that number is almost 100% nysscpa.org. The human touch in early screening is increasingly rare.

The resulting experience is frustrating on both sides:

  • As an applicant, you feel like you’re shouting into a void or battling a robot gatekeeper. You might spend hours tweaking your resume (or prompting ChatGPT to do it), only to get a canned rejection in minutes. There’s little feedback and often no sense of a human at the other end. It’s dehumanizing – like the process has become a giant algorithm and you’re just trying to figure out how to appease it.

  • For recruiters, it’s like trying to find a needle in a haystack that’s constantly being fluffed up by AI-generated straw. They open a job req and get bombarded with hundreds of applications, many of which are “spammy, low-effort” submissions resume-now.com. In fact, 90% of hiring professionals report a spike in spam applications due to AI tools resume-now.com. It’s easy to miss the truly good candidates in there. Recruiters are getting burned out, and some worry that in the rush to cut down the pile, they might overlook great talent or make compromises just to fill the role info.recruitics.com.

It’s a vicious cycle: applicants blast out more resumes (with AI help) because they’re not hearing back, and recruiters tighten the filters because they’re drowning in volume. The irony is that AI – which is supposed to improve efficiency – has, in this context, made hiring less efficient and more chaotic. There’s a sense that some parts of this process would indeed be “better left to humans,” as I’ve come to believe after seeing this mess unfold.

Where Is This All Heading?

Standing amid this wreckage, it’s fair to ask: What the heck is going on, and where do we go from here? Is this just how it’s going to be now – a soulless battle of algorithms and spam until only the luckiest or most persistent get hired? Or will the job market adapt to restore some sanity?

I don’t have a crystal ball, but I do see a few trends and possible directions emerging:

  • Quality over Quantity (for Applicants): There’s a growing realization that spraying out AI-generated resumes isn’t a winning strategy for candidates. Employers are catching on and actively weeding out generic applications. In one survey, 62% of employers said resumes that look AI-generated without personalization are likely to be rejected resume-now.com. Simply put, personalization and human touch are becoming premium again. The candidates who put in the effort to write a genuine cover letter, or who tweak their resume to truly reflect their fit for the role (instead of letting a bot do it all), will stand out. A top resume coach noted that hiring managers still “look for personalized details as a sign of genuine interest and fit” resume-now.comresume-now.com. So if you’re job hunting, the takeaway is: AI can help you, but don’t lose your voice. Use it to polish or to brainstorm, but always inject you into the application. In a sea of clones, authenticity is a differentiator.

  • Employers Setting AI Guardrails: Companies and HR teams are starting to establish policies around AI in hiring. For example, the Big Four accounting firms warned applicants not to use AI to generate their application content, presumably because they can detect the telltale blandness and don’t like it techspot.com. More broadly, 79% of employers believe there should be guidelines or rules for AI-assisted applications resume-now.com. We might see job postings explicitly say “please don’t use ChatGPT to write your cover letter” or even require some kind of statement of authenticity. How enforceable that is remains to be seen, but the concern is strong enough that it’s being discussed in recruiting forums. Companies want to stem the spam tide and ensure they’re seeing the real person they might hire.

  • The AI vs. AI Arms Race Will Stabilize: Right now it feels like an escalating war – applicants use AI to game resumes, recruiters use AI to filter, then applicants try newer AI tricks. Eventually, we’ll likely reach a more stable middle ground. “Hybrid screening” approaches are emerging, where AI handles the initial sift but human recruiters make the final calls info.recruitics.com. Recruiters are also exploring new tools that can better detect duplicate or bot applications and limit how many times one person can applyg reenhouse.com (to prevent those breakfast bots from applying 2000+ times). There’s talk of integrating more skills assessments and video interviews earlier in the process to filter out candidates who can’t back up their resumes ere.netinfo.recruitics.com. These steps can discourage pure spam applications because if you’re not serious about the role, you won’t bother to do a 20-minute coding test or record answers to questions. In short, the hiring process is evolving to counter the current chaos – likely becoming a bit longer and more involved for applicants, but hopefully more effective at finding true fits.

  • Refocusing on Human Networks: When algorithmic online applications turn into a lottery, people naturally start looking for other ways in. I’ve noticed a lot more emphasis on networking, referrals, and community in job searching now. Recruiters themselves say they are putting more focus on internal talent pools and employee referrals to find quality candidates ere.net. This makes sense – an employee referral comes pre-vetted to some degree and is less likely to be a random bot application. For job seekers, it means that good old-fashioned networking (connecting with former colleagues, posting on LinkedIn about your search, attending industry meetups even if virtual) can be a powerful way to rise above the noise. A referred candidate can skip some of the AI filters entirely. So ironically, as the tech gets more advanced, success may hinge on age-old principles of who you know and building real human relationships.

  • Adapting Skills to the New Market: Lastly, the trends in what jobs are in demand are shifting. While traditional dev roles are harder to come by, AI-related jobs are booming. Postings for AI engineering roles have skyrocketed (one report noted a 143% increase in AI engineer roles since 2024 codesmith.io). So one way to stay competitive is to upskill in areas where humans are still needed desperately – whether that’s AI/ML itself, data science, cybersecurity, or other fields where demand outstrips supply codesmith.io. I’ve started spending time learning about AI tools and machine learning frameworks, not just out of curiosity but to ensure my skill set stays relevant. The market is telling us that while some tech roles are shrinking, others are growing codesmith.io. Being flexible and targeting growth areas can be key. Of course, not everyone wants to become an AI specialist, but being aware of these shifts helps set realistic strategies (e.g. maybe apply to companies in industries that are still hiring, or take on contract work which is often more available in tight markets).

  • The Human Touch Still Matters: Perhaps the most important trend is a realization: At the end of the day, people still hire people. No matter how fancy the AI tools get, most employers still rely on interviews and personal interaction as the ultimate test. Overwhelmed recruiters are “banking on the personal interview” as an AI-proof step – a chance to see the real human beyond a polished resume techspot.com. You can’t (yet) automate your way through an interview panel; you have to demonstrate your knowledge, personality, and problem-solving in real time. This means if you do get to the interview stage, it’s crucial to shine there, because that’s where the playing field becomes human again. Likewise for companies, it’s a reminder that software can filter resumes, but it can’t (yet) replace the nuanced judgment of a hiring manager talking to a candidate. I suspect we’ll see renewed emphasis on those human elements – whether it’s through structured interviews, team fit conversations, or trial projects – to complement the AI-driven filtering.

In summary, the current state of the job market feels like a bit of a “shitshow” (pardon my French), as I vented earlier. There’s no denying it’s tough out there. AI has thrown a wrench into the works – speeding things up, but also clogging the gears with noise. Good people aren’t getting seen, and a lot of unqualified ones are clogging the pipelines. But this is not the end state. Companies and candidates alike are in a period of adjustment. We’re all figuring it out in real-time – what the new norms should be, what tools to embrace or avoid, and how to reintroduce sanity into the system.

Moving Forward: Personal Reflections

Getting laid off was not just a professional setback; it was an emotional one. Yet, it also forced me to confront this new reality and adapt. I’ve come to appreciate a few things:

  • Resilience and Learning: Just as I learned to navigate the chaos of a startup with no processes, I’m learning to navigate this chaotic job market. It means staying informed (about tools like ATS and how to write resumes that both humans and algorithms appreciate), continuously updating my skills, and not losing heart when faced with form-letter rejections. It’s tough, but I remind myself that so many others are in the same boat. The posts I see every day from talented folks struggling to get interviews remind me it’s the market, not a personal failing.

  • Smart Use of AI (as a Tool, not a Crutch): I’m not against using AI in my job search – I’ve used ChatGPT to polish a paragraph in a cover letter or to brainstorm different ways to frame my accomplishments. But I always try to make it personal and genuine before hitting send. The best results seem to come from a hybrid approach: let AI handle the tedious formatting or give you a draft, then infuse it with your own voice and specifics resume-now.comresume-now.com. This saves time but still produces a quality result. I think that’s a microcosm of how we’ll all integrate AI into work – use it to amplify, not replace, our own abilities.

  • Hope in Adaptation: History has shown that every time technology disrupts an industry, we go through some turmoil but eventually adapt. Right now we’re in the turmoil phase for hiring. Recruiters and job platforms will improve their systems (for instance, by filtering out obvious bot applications and emphasizing skill-based hiring), and job seekers will get savvier about how to stand out in an AI-heavy process. It might lead to a better equilibrium where AI handles the grunt work (like scheduling, basic resume screening for minimum qualifications) while humans focus on the deeper evaluation. The Greenhouse recruiting team, for example, suggests automating repetitive tasks but keeping critical hiring decisions in human hands greenhouse.com – that sounds like a healthy balance. I’m optimistic that, a year or two from now, applying for a job won’t feel quite as futile as it can today.

  • The Enduring Need for Human-Centric Workplaces: My time in the startup taught me how much leadership and culture matter. That lesson is just as relevant now. As I interview (when I do get interviews!), I’m gauging the people behind the process. How a company hires – whether they treat you like a person or a number – says a lot about their culture. AI should never fully replace the human touch in a workplace. We all want to work in places where we’re valued as individuals. So one silver lining: this crazy hiring landscape has made me more mindful of finding the right fit, not just any job. I’m looking for red flags (like an over-reliance on automation or a lack of personal communication) and green flags (like a recruiter who actually calls you or a hiring manager who values conversation over just your resume keywords).

In the end, being laid off was a humbling experience, but it also pushed me to understand the bigger picture of what’s happening in the job market. AI is transforming the landscape, no doubt – making some jobs obsolete, creating others, and totally changing how we match people to positions. Right now, it feels messy and unpredictable. Yet, I remind myself that we humans are still steering the ship. The tools and trends will evolve, but things like adaptability, genuine relationships, and solid leadership (whether it’s your own or someone else’s) will always be key.

I’m still navigating this journey, but I wanted to share these observations for anyone else in the same situation asking, “What on earth is going on with hiring right now?” You’re not alone, and it’s not all in your head – it is harder out there. But knowledge is power. By understanding why it’s crazy (tech layoffs, oversupply, AI overload) and how it might change, we can strategize better and stay hopeful.

If you’re job hunting, hang in there. Focus on what you can control: make your applications thoughtful, keep learning new skills, and don’t be afraid to reach out to people (humans!) in your network. If you’re a recruiter, I feel for you – your job got harder too, but thank you to those who still take the time to treat candidates with respect. Together, we’ll hopefully restore some sanity to this process.

Change is the only constant in tech, and this era of AI-driven upheaval in the job market is no exception. I’m determined to ride this wave, not let it drown me – and I hope these insights help you do the same.

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