When it comes to employment, technology and automation will always be playing a catch up game. There is always some use to which humans can be put while we are waiting for technology to catch up. If, say, robots take over driving cabs, a new industry will simply pop up to utilize the excess human resource. And the new jobs won't necessarily be good ones (quite the opposite, probably). I like that Iceland seems to realize that the purpose of existence is not to blindly seek growth, but rather to improve quality of life.
I think it's good to be skeptical about singularity. After a few months of playing around with "AI" based diffusion artwork, the conclusion I'm coming to is that it still requires human effort to create something truly novel or compositionally good. AI artwork tends to look very samey and it doesn't really produce what you want. Whether this will always be the case, I dunno. But for now, a lot of flash, not too much substance.
There was a book out a few years ago which talked about the luddites and how the "end of work" never transpired during the industrial revolution - instead, as you say new jobs took their place. The book argued that unlike then. the computing power we'll have in the near future makes all work obsolete - research, creative industries, knowledge generation, along with manual labour. Even down to human interaction itself.
Imagine seeing a virtual psychotherapist and they already know everything about you from your search history, your purchases,, your conversations with friends, where you've been, your darkest secrets, the most intimate parts of your self. They could be the most powerful psychotherapist ever, drawing on the entire world as part of their knowledge base. To me, this is terrifying but it could also be so effective as to eradicate mental illness. Imagine them with you twenty four seven, encouraging you or challenging negative thought patterns as they arise.
From memory, one of the solutions they offered was that the only labour available was emotional labour - the care industry, talking to people, spending time with the elderly. A caring, future. But what if it was nightmareish, too? - all human interpersonal relations boiling down to commerce. How could anyone be genuine in that kind of future? Would it matter?
Anyway - intrigued to see your dystopia when it's written!