Dive Brief:
- By 2029, 60% of organizations will implement smaller software engineering teams, up from 15% in 2026, according to projections published this week by Gartner. The consulting company said AI will restructure software engineering roles within organizations into “tiny teams” that focus on complex problem-solving and innovation.
- Amid fears about AI eliminating tech jobs, Gartner emphasizes that while team sizes are forecast to shrink, the number of software engineering units will increase as AI implementation expands across industries. Three quarters of software engineering leaders reported they expect their engineering staff headcount to remain steady or grow, Gartner Principal Analyst Aliyah Camacho said.
- “It’s not a reduction of overall headcount, but rather a restructuring to best take advantage of both AI and human expertise,” Camacho told Channel Dive.
Dive Insight:
AI is reshaping software engineering, though many developer jobs are uniquely resilient, accounting for 55% of all hiring at tech giants like Amazon and Microsoft, according to the 2026 State of Tech Talent Report. Still, software engineers face disruption from coding assistants, a decline in overall tech hiring and dwindling entry-level positions.
The tiny-teams model is a navigation tool for an increasingly complex tech landscape, according to Gartner. Camacho said the strategy is ideal for organizations with product operating models, rather than project-based structures, working in conjunction with platform engineering teams that provide workflows and support for the smaller units.
Consolidated software engineering teams of the future should include several roles: a product manager, a user/agent experience designer and at least one AI-native software engineer, per Gartner.
Both product management and AI engineering skills will be essential for future software engineers working in smaller teams, Camacho said.
“As we're seeing organizations adopt AI across the software development life cycle, it's certainly making some tasks much more efficient,” she said. “It's not completely replacing specific roles, but rather evolving software engineering roles. We’re seeing a convergence across roles where software engineers can take on more product manager responsibilities as well, and so as these roles compress and converge, that's what we're seeing lead to the possibility of smaller teams.”
With the shift toward smaller, more specialized teams, Camacho added that hiring junior talent is especially important. Gartner predicts that by 2028, organizations that rely on AI to cut junior roles will hollow out their own software engineering talent pipeline — currently, entry-level hiring at major tech companies has plummeted by 65% since 2019, according to the 2026 State of Tech Talent Report.
Organizations should coordinate software engineering apprenticeships and emphasize opportunities for mentorship, Camacho said.
“Software engineering organizations need to continue hiring junior talent to build their pipeline for the future,” she said. “Tiny teams are smaller, but they have space for a junior engineer to learn closely from a senior engineer.”
