Wages probably will fall but it's probably also more complex than that.
Your extremely talented engineers who build things at scale and understand the fundementals, who are basically a safe per of hands, are still going to be in deep demand. Profitiable companies that work at scale are still going to have real problems and are unlikely to turn around and tell their engineers that they're going to be getting significantly less money, as those engineers are already in their own market and these companies will still want to compete for them.
The startups filled with architecture astronauts who spend most of their time overdesigning, learning new tools, and basically doing anything that isn't meeting user needs, delivering the product or tackling some tough engineering problem, then you're likely going to see a drop because they're not really worth it in the first place.
This strikes me as a bit of a fantasy. Very few people can recognize, and even fewer value, a "safe pair of hands". Let's not also forget this industry's rampant ageism, which even in good times sidelines experience in favor of hipness. I have no idea why you think this will magically change just because times are tough.
I'm not sure the industry suffers from ageism in the way most people here think it does. The start-up community hiring cocky 24 year old team leads who refuse to heed advice from their seniors definitely aren't going to be hiring the older guy, sure.
However, remove the funding and force these companies to actually compete on merit and only those who are actually capable of delivering will still exist. At that point, hopefully, we'll see a rise of new leaders who actally value excellence.
The point is, we can only afford to value hipness over experience in bubbles and it looks like this one's about to burst. Of course, I'm not from the future, so I could be wrong.
Your extremely talented engineers who build things at scale and understand the fundementals, who are basically a safe per of hands, are still going to be in deep demand. Profitiable companies that work at scale are still going to have real problems and are unlikely to turn around and tell their engineers that they're going to be getting significantly less money, as those engineers are already in their own market and these companies will still want to compete for them.
The startups filled with architecture astronauts who spend most of their time overdesigning, learning new tools, and basically doing anything that isn't meeting user needs, delivering the product or tackling some tough engineering problem, then you're likely going to see a drop because they're not really worth it in the first place.