NEW YORK, Oct. 16, 2026 /PRNewswire/ — Egan-Jones released a commentary examining how advances in artificial intelligence could compress margins at firms that sell expertise by the hour, with ripple effects for venture capital returns and the US housing market. Egan-Jones regards broad economic disruption as a near certainty now that the latest models have crossed a threshold of quality and speed for widespread adoption.

Audit, consulting, law and engineering firms sit at the center of the analysis. They sell intellectual capital by the hour, and Egan-Jones expects their prices to decline significantly as small teams using AI match the output of large practices. KPMG pressed its auditor to pass on AI savings and won a 14% fee cut, a demand the commentary expects every audit client to make.

Seniority offers little protection. Senior staff sell expertise that AI now makes readily available, and their leverage buys time but not a guarantee of future employment. Lower barriers to entry let new rivals compete on price and quality without years of hiring.

For software providers, the commentary cites the Model Context Protocol, an open standard that lets AI models connect directly to outside software and data, as making a product’s own interface matter less. It sees pricing power eroding for legacy software and data providers, where a single product launch can now reprice a company in a day.

For private markets, Egan-Jones describes a quiet deflation in the value of money. Startups reach scale faster and, on less capital, because AI does much of the work venture funding once paid for, compressing venture returns. Few limited partners, it suggests, have priced this in.

Job losses among screen-based workers are the channel to watch for housing. Home prices rose 1.6% in the year to June, below inflation of 3.5%, and the median new home cost 4.7 times median household income in 2025, up from 3.6 times in 1984. Egan-Jones’ view is short-term downward pressure on prices, while the long-run case for urban land holds.

The commentary was not written by Egan-Jones’ credit analysts. It offers institutional investors and risk managers a framework for assessing the structural pressures building across professional services, private markets and housing.

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SOURCE Egan-Jones Ratings Co.