Sitting in his small Plainview office, software developer Gus Spathis prompts an artificial intelligence tool on his computer to produce code for a game as part of a demonstration.
He types the words, “Create a Tetris game in Python” into Claude 3.7 Sonnet, a coding AI developed by Anthropic.
Within 60 seconds, the software generated a full page of code with a detailed explanation of the steps AI took in completing the task in English. Spathis, founder and CEO of the software development firm Xogito, hit another key and a version of the falling block video game was running on his screen.
Efficient tools like Sonnet will help his company, which makes custom software and apps for small and large firms, speed up software development. But it will come at a cost, Spathis said, adding that AI will allow him to trim his 200-employee operation by 50% “while getting more work done.”
Long Island technology firms say that generative AI tools like ChatGPT, Meta’s Llama, and China’s DeepSeek that are enabling companies to increase its productivity — by 50% or higher — allow them to save money and time but some employers also foresee reducing staff headcounts due to AI’s productivity gains.
“In principle, increasing productivity is a good thing,” said Steven Skiena, computer science professor and interim director of Stony Brook University’s AI Innovation Institute. But Skiena said it’s clear that some jobs will be lost as AI increases efficiency.
“It is certainly a time of some disruption in the software industry,” he said.
Broadly, the percentage of businesses using AI continues to grow, recently released data shows.
According to a McKinsey & Company survey conducted in July 2024 and released in March, 78% of respondents said organizations are using AI in at least one business function, up from 72% in early 2024, and 55% in 2023. The survey, which polled 1,491 professionals in a variety of industries, roles, and locations, also found that some businesses have seen revenue benefits from the use of AI.
The tech sector is the biggest adopter by industry, according to the survey.
Among technology companies, 88% are using AI for at least one workplace function, with 55% using it for marketing, 39% using it for the development of products and services, and 36% using it for software engineering, the survey showed.
Additionally, 41% of employers plan to cut jobs as AI automates job functions, according to a World Economic Forum survey released in January.
“AI is having a big impact in how software firms are thinking about programming and thinking about software,” Skiena said.
Anthropic CEO Dario Amodei said in March at a Council of Foreign Relations event that in three to six months, AI would likely be writing 90% of code used by software employers, according to media reports. A year from now, Amodei said, “We may be in a world where AI is writing essentially all of the code.”
Skiena said existing AI tools are increasingly getting better at doing many tasks that would take programmers weeks or months to accomplish, even if oversight and fixes are still required.
“You ask it to generate a program to do something, and boom, it does it and it’s amazing,” he said. “It is clearly having an effect and increasing people’s productivity.”
The pace at which AI has improved in the past few years has created both challenges and opportunities for local tech firms, local executives said.
For example, since late 2022, ChatGPT, owned by OpenAI, has gone through roughly a dozen major and minor iterations. The AI company released its most recent version, GPT 4.5, in February. In late March, Japanese conglomerate SoftBank, valued OpenAI at $300 billion, according to recent reports.
“Even though we have been working with AI and process automation for years … there’s been a very rapid change in the last few years,” said Raman Puri, vice president of SVAM International Inc. of Great Neck, an IT services provider and software developer for governmental agencies and businesses on Long Island.
Puri estimated that many software developers are seeing anywhere from 50% to 75% boosts to productivity when it comes to coding because of AI tools’ speed at generating lines of usable code.
Because of that, Puri said SVAM “is investing millions” in AI tools and training for workers.
Paul Trapani, co-founder of software developer PassTech Development LLC in Plainview, said his small team has benefited immensely from tools like ChatGPT, Meta’s Llama, and Microsoft’s Copilot chat bot app.
“If a customer asks us if something is possible, we might use the AI to create a proof-of-concept program,” said Trapani, who also serves as president of the Long Island Software & Technology Network (LISTNet), a local trade group.
“It’s probably something a capable developer could develop in a few hours, but AI generates it in minutes,” he said.
“It’s helping us be a lot more productive with the staff we have rather than needing to hire additional people,” said Trapani, who employs about five workers locally and four others overseas.
Puri said while SVAM’s staff of 800 workers, 400 in the United States and 400 across India, Mexico and Canada, have become more productive, the company’s goal is to invest in AI in such a way that the company garners enough business to keep staffing levels the same.
“The economies of scale that larger companies can achieve will disproportionately be in their favor, and accordingly, small and medium-sized businesses have a higher chance of being squeezed,” Puri said.
“I need to disproportionately invest toward this technology so I rebalance the scales in my favor,” he said.
As for Spathis, the speed at which AI can perform tasks is making it clearer that in a crowded market his business is going to have to get leaner to remain competitive and keep costs down.
“With my existing set of employees, I need to find more business or need to shrink the staff down and that’s a reality,” he said.
“We are looking at societal disruption,” he said. “And we need the thinkers in our society to think deeply about how to handle this transition to minimize the impact of those people who can’t reskill,” he said.
Sitting in his small Plainview office, software developer Gus Spathis prompts an artificial intelligence tool on his computer to produce code for a game as part of a demonstration.
He types the words, “Create a Tetris game in Python” into Claude 3.7 Sonnet, a coding AI developed by Anthropic.
Within 60 seconds, the software generated a full page of code with a detailed explanation of the steps AI took in completing the task in English. Spathis, founder and CEO of the software development firm Xogito, hit another key and a version of the falling block video game was running on his screen.
Efficient tools like Sonnet will help his company, which makes custom software and apps for small and large firms, speed up software development. But it will come at a cost, Spathis said, adding that AI will allow him to trim his 200-employee operation by 50% “while getting more work done.”
WHAT NEWSDAY FOUND
- Local technology firms say AI tools are increasing productivity among programmers by as much as 50%.
- Among tech companies nationwide, 88% are using AI for at least one workplace function, with 39% using it for product development.
- Some tech employers on Long Island said they foresee reducing headcount by more than half, given advances in generative AI.
Long Island technology firms say that generative AI tools like ChatGPT, Meta’s Llama, and China’s DeepSeek that are enabling companies to increase its productivity — by 50% or higher — allow them to save money and time but some employers also foresee reducing staff headcounts due to AI’s productivity gains.
“In principle, increasing productivity is a good thing,” said Steven Skiena, computer science professor and interim director of Stony Brook University’s AI Innovation Institute. But Skiena said it’s clear that some jobs will be lost as AI increases efficiency.
“It is certainly a time of some disruption in the software industry,” he said.
Data: AI use an evolving trend
Broadly, the percentage of businesses using AI continues to grow, recently released data shows.
According to a McKinsey & Company survey conducted in July 2024 and released in March, 78% of respondents said organizations are using AI in at least one business function, up from 72% in early 2024, and 55% in 2023. The survey, which polled 1,491 professionals in a variety of industries, roles, and locations, also found that some businesses have seen revenue benefits from the use of AI.
The tech sector is the biggest adopter by industry, according to the survey.
Among technology companies, 88% are using AI for at least one workplace function, with 55% using it for marketing, 39% using it for the development of products and services, and 36% using it for software engineering, the survey showed.
Additionally, 41% of employers plan to cut jobs as AI automates job functions, according to a World Economic Forum survey released in January.
“AI is having a big impact in how software firms are thinking about programming and thinking about software,” Skiena said.
Anthropic CEO Dario Amodei said in March at a Council of Foreign Relations event that in three to six months, AI would likely be writing 90% of code used by software employers, according to media reports. A year from now, Amodei said, “We may be in a world where AI is writing essentially all of the code.”
Productivity in the age of AI
Skiena said existing AI tools are increasingly getting better at doing many tasks that would take programmers weeks or months to accomplish, even if oversight and fixes are still required.
“You ask it to generate a program to do something, and boom, it does it and it’s amazing,” he said. “It is clearly having an effect and increasing people’s productivity.”
The pace at which AI has improved in the past few years has created both challenges and opportunities for local tech firms, local executives said.
For example, since late 2022, ChatGPT, owned by OpenAI, has gone through roughly a dozen major and minor iterations. The AI company released its most recent version, GPT 4.5, in February. In late March, Japanese conglomerate SoftBank, valued OpenAI at $300 billion, according to recent reports.
“Even though we have been working with AI and process automation for years … there’s been a very rapid change in the last few years,” said Raman Puri, vice president of SVAM International Inc. of Great Neck, an IT services provider and software developer for governmental agencies and businesses on Long Island.
Puri estimated that many software developers are seeing anywhere from 50% to 75% boosts to productivity when it comes to coding because of AI tools’ speed at generating lines of usable code.
Because of that, Puri said SVAM “is investing millions” in AI tools and training for workers.
Paul Trapani, co-founder of software developer PassTech Development LLC in Plainview, said his small team has benefited immensely from tools like ChatGPT, Meta’s Llama, and Microsoft’s Copilot chat bot app.
“If a customer asks us if something is possible, we might use the AI to create a proof-of-concept program,” said Trapani, who also serves as president of the Long Island Software & Technology Network (LISTNet), a local trade group.
“It’s probably something a capable developer could develop in a few hours, but AI generates it in minutes,” he said.
“It’s helping us be a lot more productive with the staff we have rather than needing to hire additional people,” said Trapani, who employs about five workers locally and four others overseas.
Grow or go lean?
Puri said while SVAM’s staff of 800 workers, 400 in the United States and 400 across India, Mexico and Canada, have become more productive, the company’s goal is to invest in AI in such a way that the company garners enough business to keep staffing levels the same.
“The economies of scale that larger companies can achieve will disproportionately be in their favor, and accordingly, small and medium-sized businesses have a higher chance of being squeezed,” Puri said.
“I need to disproportionately invest toward this technology so I rebalance the scales in my favor,” he said.
As for Spathis, the speed at which AI can perform tasks is making it clearer that in a crowded market his business is going to have to get leaner to remain competitive and keep costs down.
“With my existing set of employees, I need to find more business or need to shrink the staff down and that’s a reality,” he said.
“We are looking at societal disruption,” he said. “And we need the thinkers in our society to think deeply about how to handle this transition to minimize the impact of those people who can’t reskill,” he said.
