It’s commonly asked, “What if AI (or the tech industry in general) is a bubble?” This is less important for employees compared to investors. Investors of AI face much more downside risk compared to employees, who are paid first. With a salary, you’re still getting paid every day that you show up. The company could fail tomorrow or the AI bubble could burst, and you would keep everything that you earned up until that point. Just 3-5 years at a high-paying AI or other tech job, assuming you invest and save diligently, is a sizable nest egg.
Moreover, Silicon Valley tech has shown a remarkable ability to transition from one ‘hype cycle’ to the next without missing a beat. First with social networking and apps (e.g. Facebook and Instagram), then post-Covid with the rise of home delivery and remote-work productivity apps (e.g. Slack, Uber, Door Dash, Discord), and now AI. So even if AI was to peak, many of those employees would be able to just ride the next wave/cycle. Their prior experience would still be useful in a job search compared to someone without any experience.
In spite of bubbles, rising interest rates, China tensions, political division, or economic turbulence–these tech jobs still keep coming out on top. A common narrative in 2022-2023 was that rising interest rates would see a long-awaited return to sobriety on Wall Street and in Silicon Valley; this was clearly not the case in 2024-2025 as stock prices and AI valuations have continued to surge.
Fears over an AI bubble remind me of similar concerns of the national debt. Yes, it’s a scary number and something ought to be done about it even though the political will is absent. But stocks and real estate have posted significant real returns since 2009 despite surging national debt.
Sitting out of the market for fear of a debt collapse may mean missing out for good. The Nasdaq has typically returned 20%/year since 2009, so sitting out for just 3 years would require a 40% decline to have an opportunity to buy back in at that same price–good luck with that, given that the last time this occurred was in 2008. Same for fears of a housing bubble–sitting out in the hope of lower prices often means having to scramble to buy at a higher price later. Many learned this the hard way in 2010-2013 or after Covid. Waiting often just means missing out and being made worse-off as a result.