I think you are misunderstanding what this tech demo actually is, but I will engage with what I think your gripe is — AI tooling trivializing the skillsets of programmers, artists, and designers. My first games involved hand assembling machine code and turning graph paper characters into hex digits. Software progress has made that work as irrelevant as chariot wheel maintenance. Building power tools is central to all the progress in computers. Game engines have radically expanded the range of people involved in game dev, even as they deemphasized the importance of much of my beloved system engineering. AI tools will allow the best to reach even greater heights, while enabling smaller teams to accomplish more, and bring in some completely new creator demographics. Yes, we will get to a world where you can get an interactive game (or novel, or movie) out of a prompt, but there will be far better exemplars of the medium still created by dedicated teams of passionate developers. The world will be vastly wealthier in terms of the content available at any given cost. Will there be more or less game developer jobs? That is an open question. It could go the way of farming, where labor saving technology allow a tiny fraction of the previous workforce to satisfy everyone, or it could be like social media, where creative entrepreneurship has flourished at many different scales. Regardless, “don’t use power tools because they take people’s jobs” is not a winning strategy.

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"How, exactly, could AI take over by 2027?" Introducing AI 2027: a deeply-researched scenario forecast I wrote alongside @slatestarcodex, @eli_lifland, and @thlarsen