What Happens When AI Replaces Every Job?

Artificial intelligence is no longer a distant future concept—it's rapidly transforming industries, economies, and the very fabric of work itself. Among the many sectors impacted, recruiting stands out as a field already experiencing significant AI integration. But what happens when AI advances beyond assisting human recruiters to fully replacing jobs across the board? This is the $100 trillion question that economists and policymakers are grappling with today.

Anton Korinek, a professor of economics at the University of Virginia and a leading expert on the economics of artificial general intelligence (AGI), offers a sobering yet insightful perspective on this seismic shift. With AGI poised to arrive within just a few years, Korinek explains why our current economic systems are ill-prepared for the impending revolution and why radical changes—such as universal basic income—may be inevitable.

Understanding the Economics of Artificial General Intelligence

Artificial general intelligence refers to AI systems that surpass human intellectual capabilities across virtually all domains. Unlike today's AI, which excels at specific tasks like data analysis or language processing, AGI would be capable of performing any cognitive task that a human can do, and more.

Korinek began focusing on the economics of AGI over a decade ago when the field was niche and speculative. Now, with AI progressing at breakneck speed, the timeline has compressed dramatically. "We are so close," Korinek says, estimating that AGI could arrive within the next two to five years. This rapid evolution makes research on AGI's economic impact more urgent than ever.

Korinek's research addresses critical questions such as:

• How will AGI affect labor markets and employment?
• What impact will it have on productivity and economic growth?
• How might it influence market concentration and competition?
• How can AI agents be integrated into economic activities, including research?

These questions are not just academic—they have profound implications for every business leader, policymaker, and worker navigating today's AI-driven economy.

AI in Recruiting: A Window into a Larger Transformation

Recruiting is one of the first areas where AI has made a noticeable impact. From parsing resumes to conducting preliminary interviews, AI tools help organizations streamline hiring processes, reduce bias, and identify talent more efficiently. However, this is just the beginning.

As AI systems become more sophisticated, they will increasingly take over tasks traditionally performed by humans, including those requiring nuanced judgment and interpersonal skills. This raises pressing questions about the future role of human recruiters and the broader employment landscape.

Korinek notes that while AI currently outperforms humans in many specialized domains—such as math and text analysis—it still lags behind the best human experts in some areas. Yet, the pace of improvement is staggering. Benchmarks show AI systems rapidly achieving and surpassing human-level performance in a growing number of tasks, signaling a future where AI could handle recruiting end-to-end and beyond.

The End of Five-Year Plans: Navigating Uncertainty in a Rapidly Changing World

The speed of AI development is so fast that long-term planning, once a cornerstone of business strategy, has become nearly impossible. Arvind Srinivas, CEO of Perplexity AI, has highlighted that from a business perspective, planning horizons have shrunk from years to months due to the rapid pace of technological change.

Korinek echoes this sentiment:

"It's completely unpredictable what the world will look like in a couple years down the road."

 This unpredictability is partly due to the potential arrival of AGI, which would transform the economy in ways that are difficult to imagine today.

For recruiters and HR professionals, this means staying agile and continuously updating strategies to incorporate AI innovations. The traditional five-year career or business plan is giving way to a dynamic approach that requires constant learning and adaptation.

The Invisible Economic Impact of AI So Far

Despite AI's rapid advances, its impact on macroeconomic indicators like productivity and growth is still largely invisible. Korinek points out that AI has yet to show up significantly in productivity statistics or other economic measures.

Nonetheless, businesses worldwide are investing heavily in AI integration, and early adopters are beginning to see small payoffs. The expectation is that these benefits will multiply exponentially as AI systems improve and become more widespread.

This lag between AI's capabilities and its measurable economic impact suggests that we are on the cusp of a major disruption—one that will reshape labor markets and wealth distribution profoundly.

The Great Disruption: How AGI Will Change Labor Markets

One of the most challenging questions is how AGI will affect employment. By definition, AGI can perform any task a human can, making human workers easily substitutable.

This substitution effect means wages and labor market value for many workers could decline sharply as AI systems become cheaper and more efficient. Korinek explains, "Once you're substitutable and you have the technology, which is rapidly getting cheaper, then it means our wages or our labor market value would also decline in tandem."

The implications for recruiting are profound. If AI can handle all stages of hiring and talent management better than humans, the demand for traditional recruiting roles may diminish. Instead, recruiters may need to pivot toward roles involving AI oversight, ethical considerations, and strategic workforce planning.

Universal Basic Income: From Radical Idea to Inevitable Policy

The potential displacement of human labor raises urgent questions about income distribution. Our current system largely depends on people earning wages from work or receiving pensions based on past employment. Korinek argues this model will not hold in an era dominated by AGI.

He suggests that radical economic changes, such as universal basic income (UBI) or universal basic capital, will become necessary to ensure that the benefits of AI-driven productivity gains are shared broadly rather than concentrated among a few.

While UBI is often viewed as a radical or expensive policy, Korinek believes it will become inevitable after AGI takes off. Right now, he acknowledges that UBI is premature and could disincentivize work in an economy that still relies heavily on human labor. But the economic landscape will change dramatically once AI systems outperform humans across most cognitive tasks.

The Competition Paradox and the Global AI Arms Race

Another concern is the lack of global cooperation on AI development and regulation. Korinek highlights a "big race" between AI superpowers to make progress faster, which could incentivize companies and countries to cut corners and develop riskier AI systems.

This competition paradox poses significant risks for society, including safety concerns and political destabilization. Governments currently lack the expertise and infrastructure to effectively regulate AI, underscoring the urgent need to build institutional knowledge and international collaboration.

Preparing for the Future: The Role of Governments and Businesses

Korinek stresses that acquiring expertise in AI at the governmental level is critical. Policymakers must understand how to engage with AI companies and systems to make informed decisions, especially in competition and regulatory spheres.

For businesses, the advice is clear: stay informed and flexible. The best plan is to continuously monitor AI developments and update strategies accordingly. This approach applies not only to recruiting but to all aspects of business and economic planning.

Integrating AI Agents into Research and Economic Activities

Beyond its disruptive effects, AI also offers enormous opportunities to accelerate progress on pressing societal challenges. Korinek is actively researching how AI agents can be integrated into economic research, enabling faster and more robust analysis.

This integration represents a methodological shift that could revolutionize how economists and policymakers understand and respond to complex economic phenomena, including those driven by AI itself.

Conclusion: The Urgency of Facing the AI Revolution Head-On

The economic revolution driven by artificial intelligence is unfolding faster than most anticipate. With AGI potentially arriving within just a few years, the stakes could not be higher. Our current economic systems, policies, and institutions are not equipped to handle the profound changes ahead.

For those involved in recruiting and workforce management, understanding AI’s trajectory is essential. The future will demand new skills, new approaches, and new policies to ensure that AI benefits society as a whole rather than exacerbating inequality.

As Korinek warns, “It’s completely unpredictable what the world will look like in a couple years down the road.” The best way to prepare is to stay informed, embrace adaptability, and engage in the critical conversations about how we want AI to shape our economic future.

Whether you are a CEO, recruiter, employee, or student, the question is no longer if AI will transform your world but when—and how ready you will be when it does.