A Small Team With AI Could Push Down Professional Fees
On September 30, Egan-Jones said a handful of workers using AI to do the work of a whole floor could significantly lower prices for professional services. The statement appeared on its Insight page, its-over. Egan-Jones
Who is behind the claim
Egan-Jones provides regulated credit opinions, or views on whether borrowers can repay debt. It is designated as a Nationally Recognized Statistical Rating Organization by the U.S. Securities and Exchange Commission, a status that lets regulators use its ratings, and certified as a credit rating agency by the European Securities and Markets Authority and by the UK Financial Conduct Authority. It is also listed as a credit rating provider for the National Association of Insurance Commissioners. It states that top American life insurers hold Egan-Jones-rated assets.
What came before
The September 30 note followed other published accounts of AI affecting asset prices and household decisions. The Wall Street Journal reported on February 23 that the Dow Jones Industrial Average, a widely watched index of 30 large U.S. stocks, fell 1.7%, or 822 points, driven by fears of AI disruption and new trade-policy uncertainty. The Wall Street Journal That report was dated February 23. On February 24, The Guardian published an article titled "'A feedback loop with no brake': how an AI doomsday report rattled markets". The Guardian
Closer to the Egan-Jones publication, Fortune published an article titled "Americans are turning to AI to survive a brutal housing market" on September 22, 2026. Fortune
To put the timing in context, February brought an equity fall explicitly tied to AI disruption risk alongside trade-policy uncertainty, according to that reporting. September brought retail-level adoption stories in housing, then a rating agency framing the mechanism as labor leverage in services. The claim is narrow. It is not about model capability. It is about headcount, utilization and unit pricing in professional services.
The broader context here is credit transmission. Professional services firms carry high variable compensation and low tangible collateral, or property a lender could sell. If output per fee-earner rises sharply while billing rates fall, revenue durability depends on volume retention and client concentration. For issuers that purchase those services, the effect runs the other way, through procurement savings and SG&A release, or lower day-to-day running costs. A rating view has to hold both channels at once.
In my view, practitioners should treat the Egan-Jones formulation as a pricing hypothesis, not a realized loss or upgrade driver. Price deflation from AI leverage is plausible in legal, audit, consulting, engineering and outsourced analytics. Timing, pass-through and contract stickiness were not specified. Investment-grade cash flow analysis, which focuses on safer corporate borrowers, penalizes margin forecasts without contracted volume. That discipline applies here.
Looking at what this means for portfolios, the insurer detail is relevant. Life books holding rated assets are sensitive to downgrade migration, or ratings slipping lower, and to spread widening, when investors demand more extra yield to hold risk. If fee compression impairs coverage ratios, or the earnings cushion to pay interest, for leveraged services issuers, while improving margins for heavy buyers of those services, sector differentiation widens. Correlation assumptions across BBB services, the lower rung of safer company debt, and diversified buyers would need review. No migration has been announced. The point is directional exposure, not imminent action.
