I think you've hit on half the actual issue.

The other half is that a properly guided AI is exponentially faster at junior tasks than a junior engineer. So much so that it's no longer in anyone but the junior engineer's interest to hand off work to them.

This is what I've been finding. Currently, if I have a junior level task, I take the email I would have sent to a junior developer explaining what I want and give it to ChatGPT/Claude/etc and get a reasonably good solution that needs as many feedback loops as the junior dev would have needed. Except I got that solution in a few minutes.