That is one possibility (that is playing out). Another one worth contrasting is the idea of AI as leverage for the worker. If you can take a regular developer and augment their output by 25%, then they have become more valuable to you and you should pay them more. Why should you pay them more? Because the market rate will price in that they provide more value now and you'll lose those workers to competitors if you don't.

That's a pretty old economic idea, and it will be interesting to see if it holds up in this instance. I have no idea how this all plays out. I do think it won't be one size fits all though.