📄 Abstract
The paper examines the relationship between technological innovations and the labour markets. The entry of AI into general use has shown significant signs of reducing future job opportunities. Drawing on Schumpeterian growth theory, the study affirms that innovation is a creative process with destructive outcomes. Technological progress occurs in a cycle of vertical innovation that generate temporary monopoly rents for entrepreneurs and inevitably render labour redundant, jobs polarized, and skills obsolete. The creative part of innovation expands aggregate demand, lowers, production, creates new occupations, and shifts labour to words service oriented tasks. In contrast, the destructive phase renders skills obsolete, displaces routine jobs, and accelerate labour market polarization. It also creates short-term hardships due to the relative immobility of human capital compared to financial capital. AI innovation represents a qualitative departure in technological disruption by encroaching on non-routine cognitive tasks previous considered exempt from automation. Preliminary evidence shows AI risks compressing entry-level pathways in knowledge work, slowing skills development, limiting human capital adaptability, and increasing inequality. Emerging economies must remodel human capital development to mitigate the harsh reality posed by technological advancement.
🏷️ Keywords
📚 How to Cite:
Paul Wangila Sitati, Dr. Yasin Ghabon , CREATIVE DESTRUCTION AND THE LABOUR MARKET , Volume 12 , Issue 4, April 2026, EPRA International Journal of Multidisciplinary Research (IJMR) , DOI: https://doi.org/10.36713/epra26942