Yale Economist Predicted AI Job Market Collapse

Yale economist Pascual Restrepo, a former MIT collaborator of 2024 Nobel laureate Daron Acemoglu, accurately forecast AI's impact on labor markets before most economists took it seriously. His research identified how automation eliminates high-value tasks within jobs, repricing workers rather than replacing them outright — a mechanism now reflected in a 35% drop in U.S. entry-level job postings since January 2023. Restrepo's more provocative work examines an AGI-driven future where labor's share of economic income converges toward zero — not through mass firings, but because income-generating work no longer requires humans. He places this scenario as early as the 2030s, with computing power replacing human labor as the primary economic driver.