Why Egan-Jones says the shift is near
The agency’s timing rests on its assessment that the latest models have crossed the quality and speed threshold needed for broad adoption. It expects companies to use AI to cut costs and sees a new business model emerging: smaller teams could accomplish much more, while some companies may need no people at all.
AI startups, Egan-Jones argues, will be able to grow with less investment. That would make capital less important to businesses that once depended on it, reducing the influence and returns of venture firms.
Professional services face a more direct challenge. Clients can now turn to an AI chatbot for advice rather than relying only on a person in a suit. Some consulting firms are already cutting staff in layoffs linked to AI.
A forecast, not a consensus
The agency’s warning lands amid a wider focus on AI’s existential risks. Industry leaders including Elon Musk, Dario Amodei and Mark Zuckerberg recently went to the White House and signed a self-regulation agreement, effectively promising not to build models capable of destroying the world. Meanwhile, experts continue to worry that AI automation could reshape entire industries and eliminate whole categories of jobs.
Egan-Jones is small, and its forecasts do not carry the weight of those from the three largest rating agencies. Many economists also say AI’s employment effects remain difficult to measure. Employers may find it convenient to blame AI when cuts are really driven solely by financial pressures.
I think the more consequential signal is not that this forecast is settled economics. It is that the prospect of AI dismantling the familiar economy is now being treated as a serious scenario, even by an agency whose reach is limited. The question is whether adoption will move fast enough to make that scenario visible before anyone can measure it clearly.
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