AI's Wage Boost May Hit Its Peak Sooner Than Expected, New Research Shows
The AI revolution that's been driving up wages could be reaching a turning point sooner than many expect. According to new research from Penn professor Ioana Marinescu and the Brookings Institution, we may already be approaching the moment when artificial intelligence starts suppressing wages instead of boosting them.
The Critical 37% Threshold
Marinescu's model reveals a concerning milestone: once roughly 37% of cognitive tasks become automated, wage growth could reverse direction. Her research shows the economy has already automated over 14% of "intelligence" tasks—putting us closer to potential wage declines than previously thought.
The professor bases her findings on data showing routine cognitive jobs dropped from 49% in the late 1970s to 35% in 2018—a 14-point decline that signals significant automation in intelligence-based work.
Warning Signs Already Emerging
Key indicators that wages may be peaking include:
- Slowing wage growth across intelligence-heavy sectors
- Employment shifts from cognitive jobs toward physical roles
- Job losses in tech not being offset by new high-value positions
"For wages to ever decline due to automation, it is necessary to see a decrease in the share of workers in intelligence jobs," Marinescu explains. This could happen if software developers, translators, or marketing writers are replaced by AI without new roles emerging to compensate.
Which Jobs Face the Biggest Risk
The research suggests automation will target the easiest intelligence tasks first—particularly jobs involving pattern recognition, translation, and basic writing. Translators and marketing copywriters may be among the first to see significant job displacement.
The speed of this transition depends heavily on how interchangeable physical and cognitive work becomes in the broader economy.
What This Means for Workers
Understanding where you stand on the "AI pay curve" is crucial for career planning. While AI tools currently boost productivity and wages for many knowledge workers, that advantage may not last indefinitely. The key metric to watch is whether more people are moving away from desk-based cognitive jobs toward physical, hands-on roles.
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