alt Hacker NewsI'm not really sure I understand the excitement around this. It seems like the implication is that if retail price > employee salary, you are replacing employees with AI spend? Yet, anthropic's head count has nearly doubled since last year - so, in a company where nearly half of that head count is engineers, but claude is "writing 90% of the code," what is everyone doing then? You would think, if the hype feeling around this held true, that the output would be going up and costs remaining stable. Costs rising as you scale is not a new thing but that's not really what AI promises. It sounds to me like the retail AI spend per employee is very high. What is the appeal of that?
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Imagine an employee is 1x productive without AI.
Now spend 0.5x their salary on AI, and they become 5x productive compared to no AI.
Now spend 1.1x their salary on AI, and they become 20x productive compared to no AI.
It's still obviously worth it to spend the 1.1x. But it is truly remarkable that the biggest cost of hiring a knowledge worker is no longer their salary, but their AI usage.
There is no implication here that employees are being replaced by AI spend, as long as all of the productivity is generating profit. The AI usage still needs a knowledge worker to direct it in ways that it can't direct itself, so you still need the employees.
> what is everyone doing then?
Making sure Claude doesn't kill everyone on Earth, if they are to be believed.