(Yicai) May 7 -- Many tech companies in Silicon Valley have or plan to let go of employees and invest the saved funds in artificial intelligence infrastructure, shifting to a dumbbell from a pyramid organizational structure amid this wave of layoffs.

Meta plans to cut around 8,000 workers, or about 10 percent of its global workforce, starting May 20. In addition, Snap laid off 1,000 full-time employees, or 16 percent of its headcount, on April 15, pointing out that AI has generated over 65 percent of its new code, while Amazon trimmed around 30,000 white-collar jobs from last October to the beginning of this year.

Meanwhile, the planned combined capital expenditure of the four major tech platforms -- Alphabet, Amazon, Meta, and Microsoft -- is nearly USD700 billion for this year, up over 60 percent from the previous, with the money to be shifted from wages to buying graphics processing units.

This round of layoffs has its particularity. Those being let go are neither front-line executors nor top-level decision-makers, but middle-level managers and general white-collar workers -- coordinators and reporters from Level 5 to Level 7.

Andy Jassy, chief executive officer of Amazon, defined it as reducing hierarchy and de-bureaucratization. What AI does to white-collar jobs is what the Industrial Revolution did to blue-collar workers, an expert noted.

The organizational structure of tech companies in Silicon Valley is evolving from a pyramid to a dumbbell shape: a small number of highly paid decision-makers at the top and a small number of highly leveraged engineers at the bottom, with the management and general positions in the middle being systematically compressed or even eliminated.

Startups are being compressed to a single person. Seed-stage investors in Silicon Valley are frequently coming into contact with so-called one-person companies. A startup with only two people is doing business with the help of AI agents that previously required a public relations team of over a dozen workers: sending marketing emails in batches every morning, monitoring open rates and reply rates, and optimizing strategies in real time.

Anthropic's CEO Dario Amodei said that the first one-person billion-dollar company will emerge this year at the AI firm's first developer conference last year.

Sam Altman, founder of OpenAI, said that he and other tech CEOs have a private group chat where they once bet on when this would happen, with him predicting it would be between 2026 and 2028.

Around 36 percent of new startups worldwide will be OPCs this year, according to Scalable.news.

From the perspective of Silicon Valley, what is most disturbing about this situation is not who is laid off, but that companies do not deteriorate afterward. In some quantifiable indicators, they even improved.

This is the true "liquidation" in an organizational sense: not getting rid of underperforming employees, but eliminating an entire organizational level that was once considered indispensable, and then finding that the company still operates smoothly.

The author of this article is Lu Yuan, a special contributor for Yicai in Silicon Valley.

Editor: Martin Kadiev