AI Is Reshaping the UK Job Market Faster Than Elsewhere
Artificial intelligence is having a bigger impact on jobs in the UK than in other major economies, according to new research.
While AI is boosting productivity for many businesses, studies suggest Britain is currently losing more jobs to automation than it is creating, putting additional pressure on an already fragile job market.
UK Sees Net Job Losses Linked to AI
Research from investment bank Morgan Stanley indicates that UK companies have reported net job losses linked to AI over the past 12 months.
British firms reported an average fall of 8 percent in jobs, the highest rate among the large economies studied, including the United States, Germany, Japan, and Australia.
The findings suggest that while AI adoption is accelerating, the UK is struggling to turn those gains into new employment opportunities.
Workers Growing Increasingly Anxious
Concerns among workers appear to be rising.
A separate survey by recruitment firm Randstad found that more than a quarter of UK workers fear their jobs could disappear completely within the next five years due to AI.
Younger workers, particularly those in Gen Z, reported the highest levels of concern. Many said they are unsure how quickly they can adapt to changing technology.
Older workers, especially those nearing retirement, showed greater confidence and less anxiety about the impact of AI.
Early-Career Roles Most at Risk
According to the research, roles requiring two to five years of experience are among the most vulnerable.
Businesses surveyed said early-career and junior positions are the most likely to be reduced as AI tools take on tasks previously handled by less experienced staff.
This raises concerns about how young people will gain experience and progress in their careers if entry-level opportunities continue to shrink.
Warnings From Political and Business Leaders
Earlier this month, the Mayor of London warned that AI could lead to widespread job losses in the capital.
He said London is particularly exposed due to its reliance on white-collar roles in finance, creative industries, and professional services such as law, accounting, consulting, and marketing.
Business leaders have echoed similar concerns, warning that governments and employers must support workers displaced by technology to avoid social and economic unrest.
Productivity Up but Jobs Still Falling
Despite the job losses, AI is clearly delivering productivity gains.
British companies reported an average productivity increase of more than 11 percent after adopting AI tools.
However, unlike the US, where productivity gains have been accompanied by job creation, UK businesses appear to be cutting roles at the same time.
Economic Pressures Add to the Problem
The research suggests the impact of AI is being intensified by wider economic pressures.
Higher operating costs, rising taxes, increases in the minimum wage, and higher employer national insurance contributions are all weighing on hiring decisions.
Unemployment in the UK is now at a four-year high, making the transition to an AI-driven economy even more challenging for workers.
Basically…
AI is boosting productivity in the UK, but it is also leading to job losses faster than in other major economies.
Younger and early-career workers appear to be most at risk, and without new roles to replace those lost, concerns about long-term unemployment are growing.
