According to recent analysis, the global economy is shifting drastically due to advancements in artificial intelligence (AI), a trend referred to as the “Great Decoupling.” It marks a transition from a “Knowledge Economy,” dependent on human labor, to an automated system that prioritizes data and computational power. Key statistics highlight this shift: corporate profits in relation to GDP have risen to record highs of 11.55%, while labor’s share has fallen to 53.8%, the lowest since the 1940s.
This phenomenon has echoes of “Engels’ Pause” during the Industrial Revolution, wherein economic growth and corporate profits increased, yet wages did not benefit workers. Today, as AI technologies like recursive algorithms outperform human efficiency, the labor market faces unprecedented levels of disruption, leading to a potential “Useless Class.” Companies now require fewer employees, with AI taking over roles traditionally filled by the knowledge labor force.
Investment strategies are evolving in this new landscape. Experts suggest reallocating resources from businesses dependent on human expertise to those that support AI infrastructure, such as energy and advanced computing. Goldman Sachs anticipates a 160% surge in data center power demand by the decade’s end, illustrating the new economic priorities focused on computational and energy resources essential to drive future growth.
