One thing that is somewhat unique about software engineering is that a large part of it is dedicated to making itself more efficient and always has been. From programming languages, protocols, frameworks, and services, all of it has made programmers thousands of times more efficient than the guys who used to punch holes into cards to program the computer.
Nothing has infinite demand, clearly, but the question is more whether or not we're anywhere near the peak, such that more efficiency will result in an overall decrease in employment. So far, the answer has been no. The industry has only grown as it's become more efficient.
I still think the answer is no. There's far more of our lives and the way people do business that can be automated as the cost of doing so is reduced. I don't think we're close to any kind of maximum saturation of tech.
Yes, what I'm saying is that lower costs for software, which AI will help with, will make software more competitive against human production labor. The standard assumption is that if software companies can reduce the cost of producing software, they'll start firing programmers but the entire history of software engineering has shown us that that's not true as long as the lower cost opens up new economic opportunities for software users, thus increasing demand.
That pattern stops only when there are no economic opportunities to be unlocked. The only way I think that happens is when automation has become so prevalent that further advancement has minimal impact. I don't think we're there yet. Labor costs are still huge and automation is still relatively primitive.