Demand for workers can shrink but the supply will not and wages will bottom out and as they do so will demand for goods, effectively creating a catch-22.
That's why a universal basic income is such a beautiful concept. It would remove from the equation human survival as an individual incentive - thus reducing the supply of workers when the work offers are not attractive enough, solving that particular problem.
If everyone had their basic survival guaranteed through an unconditional minimum wage, the work market would be driven by individual initiatives to create pretty things and to improve from that basic status by pursuing luxury.
The main fear against the UBI is that those incentives would not attract enough workers to support the needs of mankind as a whole, but I don't see evidence that this would be the case - the drive to be creative and improve your personal status are pretty strong ones.