Barclays Is Cutting the People Who Build Its Software
On 22 October Barclays said it is cutting around 5,000 jobs this year, about 5% of the bank, and tied the cuts to AI. You’ll have seen the headline. The detail that matters sits further down: around 60% of the cuts fall in support functions, and developers are among them.
The bank is cutting the people who build its software, because software can now write software.
This isn’t a bank in trouble
Barclays made £2.3 billion before tax in the third quarter, up 12% on a year ago. This isn’t a rescue. The bank says it is using technology such as AI to cut fixed costs and improve returns, and I read that as spending moving from salaries to computing power.
When a struggling business cuts jobs, it’s having a bad year. When a healthy one does, it’s changing how it operates, and that doesn’t reverse when the economy picks up.
(1,000 of the 5,000 had already gone in the first half of the year, and “AI” reads well in an earnings statement, so some of this is ordinary cost-cutting with a new label. Not all of it.)
What’s actually being cut
Look at what’s going and it’s the layers: support functions, and the people whose job is passing work between other people.
In 1937 an economist called Ronald Coase explained why big firms exist. Organising work inside one company was cheaper than buying every piece of it on the open market. Managers, coordinators and handoffs were the cost of being big, and for most of a century that cost was worth paying.
AI is driving that cost down. When coordination gets cheap, the right size for a firm shrinks, and Barclays is getting smaller to stay competitive.
My business is one person and Westworld, the operating system I’ve built around Claude Code, with no team, by choice. I explained why in The Small Room. A year ago that looked like a limitation. This week a bank with around 100,000 staff started heading the same way.
What doesn’t get cut
For sixty years the safe job belonged to the person who could build the thing. Learn to code and you’ll be fine. I think that stopped being true this week.
The safe job now belongs to the person who knows what to build and can tell when it’s right. In a kitchen, AI is taking over the line, where the cooking happens. It isn’t taking the pass, where someone tastes every plate before it leaves. I made the longer case in The Third Position on AI: AI doesn’t replace the person. It moves them up to the level where judgement and taste do the work.
You can’t download judgement. Everyone can use the same models, so the model isn’t the advantage. The advantage is everything you’ve built around it: what you know about your customers, your history, what you’ve tried and abandoned. Anyone can use AI. The art is situating it.
What this means for your business
Two things follow for a business like yours.
First, being small is no longer the handicap it was. Your big competitors paid for coordination, and that cost is collapsing. You never paid it. The gap between you and them on output is closing, and the advantage you always had, knowing your customers and caring about the details, is still yours.
Second, look at what you pay other people for. If you pay an agency or a developer, part of that bill covers hours and handoffs, the same layers Barclays is cutting. That part of the market is about to get much cheaper. Judgement won’t: someone who understands your business well enough to know what’s worth doing.
The one thing to do this week
Ask whoever looks after your website or marketing one question: “How much of what I pay you is for judgement, and how much is for hours?”
If they can answer clearly, keep them. If they can’t, that tells you something too.
Tony
Sources: Reuters, via The Business Standard, and Sharecast. Figures as reported on 22 October 2026.