The Economics of Intelligence

Citadel

Frank Flight

Research

18 Pages

Citadel Securities argues that AI may be less about replacing labor and more about expanding demand for compute, power, infrastructure, and skilled workers. The piece pushes against the displacement narrative, noting that software job postings are up 18% since May 2025 while AI is increasingly framed as a labor complement.

Key Takeaways

Compute Costs Rise: One AI budget example implies spending was running at roughly 3.5x the pace originally expected.
Labor Demand Holds: Software job postings rose 18%, while accountancy rose 18% and overall job postings fell 4%.
Executives See Complements: In 2025Q4, 43% of firms framed AI as a labor complement, while only 5% framed it as a substitute.
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