On July 22, Monday.com cut 620 jobs — 20% of its global workforce. The company was growing at 24% year-over-year. Revenue hit $351 million in the first quarter. By any conventional measure, business was good. The layoffs, the company explained, were about reallocating resources toward AI.
The internet’s instant diagnosis was predictable: another data point in the slow-motion extinction of the mid-level software engineer. The Hacker News thread practically wrote itself. “AI is removing the middle class of software engineering,” went the top post, and 473 upvotes later, the narrative had hardened into received wisdom.
There’s just one problem with that story. Look at who actually got cut.
Who Actually Got the Pink Slips
Monday.com’s own filings and the subsequent coverage make the breakdown clear. The heaviest cuts landed on product management, operations, marketing, and go-to-market roles. These were not engineers. They were the coordinators, the planners, the internal-tooling PMs, the marketing operations specialists — the connective tissue that grew thick around tech companies during the years when money was free and headcount was a vanity metric.
Meanwhile, the company is actively hiring AI engineers and enterprise salespeople. The restructuring is not a reduction in technical headcount. It is a reallocation toward it.
This pattern is not unique to Monday.com. IBM, which has eliminated an estimated 3,000 to 9,000 U.S. positions across 2025 and 2026, is simultaneously tripling its entry-level hiring for AI and hybrid-cloud roles, according to Bloomberg. The cuts and the hires are happening in the same quarter, often in the same division. The churn is not about replacing engineers with chatbots. It is about replacing non-engineers with engineers who can build the chatbots.
The ZIRP Hangover Nobody Wants to Discuss
For more than a decade, venture-subsidized growth created an organizational ecosystem that made sense only under the assumption that capital would stay cheap forever. Companies hired product managers to manage other product managers. They built marketing operations teams to run A/B tests on email subject lines. They staffed entire departments dedicated to “internal tools” that were really just CRUD wrappers around Salesforce.
None of this was fraudulent. In a 2% interest-rate world, the math worked. A company growing at 30% annually could afford to carry organizational slack because the cost of that slack was negligible next to the imperative of scaling fast and not missing a quarter.
That world ended in 2022. What we are watching now — 122,000 tech layoffs in 2026 alone, with 78% of companies citing AI as the reason, per Layoffs.fyi — is not a sudden technological displacement. It is a long-overdue organizational correction that AI is providing a convenient vocabulary for. “Reallocating resources toward AI” sounds strategic. “We hired too many people during the ZIRP bubble and now we need to cut the fat” does not.
As one product manager at a mid-sized SaaS firm put it in a Slack message after the Monday.com news broke: “I’ve survived three reorgs. The fourth one won’t have a seat for someone whose job is to write PRDs that an AI can draft in 12 seconds.” She is not an engineer. She is not worried about AI taking her job because it can code. She is worried because it can do her job — the synthesis, the drafting, the coordination — well enough that a senior engineer with a Copilot subscription no longer needs her in the loop.
What the Hiring Data Actually Says
If AI were truly hollowing out the middle tier of software engineering, you would expect to see collapsing demand for mid-level engineers. The data, so far, points in the opposite direction.
Tech job postings passed 575,000 in April, the highest level in three years. Software engineering postings were up 32% year-over-year, according to one major hiring platform’s data. The roles being added are not exclusively senior architects and AI researchers. Companies are hiring engineers at every level — they are just hiring fewer of the people who used to sit between the engineers and the work.
The “middle class” that is actually disappearing is the professional-managerial layer that grew up around software engineering during the boom years: the program managers, the agile coaches, the developer-experience evangelists, the people whose job was to facilitate the job of people who build things. AI is not replacing the builders. It is replacing the facilitators.
This is a more uncomfortable story than the one about coding jobs vanishing. It is easier to sympathize with a mid-level engineer whose craft is being automated than with a marketing operations manager whose role existed because a VP needed direct reports to justify a promotion. But the discomfort of the story does not make it false.
The Real Bifurcation
The labor market for software engineers is bifurcating, but not in the way the viral blog posts describe. The split is not between “senior architects who keep their jobs” and “junior devs who don’t.” It is between people who build things and people who manage the process of building things. The former are in demand. The latter are being shown the door, and AI is the stated reason because “we never needed this many project managers” is not something any CEO wants to say out loud.
Monday.com’s 620 layoffs are not a warning about the future of software engineering. They are a warning about the past — about what happens when an industry that spent a decade hiring for abundance confronts a world that no longer subsidizes it. The engineers will be fine. It is everyone else who should be updating their résumés.