One in six UK employers expect artificial intelligence to reduce the size of their workforce within the next 12 months. That’s according to a major new survey that warns of increasing disruption to white-collar employment.
Research from the Chartered Institute of Personnel and Development (CIPD) found that 62 percent of those expecting job losses believe that clerical, junior management, professional or administrative roles would be the first to go as automation increases.
The findings, released ahead of this month’s Budget, are based on the CIPD’s latest Labor Market Outlook – a survey of more than 2,000 employers – and highlight the growing tension between AI-driven productivity gains and the threat to early-career jobs.
The impact is expected to be most noticeable among large private sector companies, where more than a quarter (26 percent) of employers expect headcount to decline as AI becomes more widespread. This compares to a total of 17 percent in the private sector and 20 percent in the public sector.
The warning comes as companies weigh up AI adoption against high employment costs and sluggish growth since last year’s Budget. Global technology and services groups have already started restructuring.
Amazon announced last month it would cut 14,000 corporate jobs, calling generative AI the most transformative technology since the internet, while PwC cut its global workforce by 5,600 last fiscal year – its first major workforce cuts since the 2008 financial crisis – despite spending nearly $1.5 billion to expand its AI capabilities.
Recruiters say employers are becoming more cautious about hiring as they try to balance cost controls with efficiency gains through automation.
Separate research by ManpowerGroup, which tracks hiring plans in 42 countries, found the UK is facing one of the sharpest recruitment declines in the world and is hit by a “perfect storm of cost pressures, AI disruptions and political uncertainty”.
The CIPD said the government must ensure that workers most exposed to AI – particularly those in entry-level or lower professional roles in finance, insurance, IT and administrative services – are supported through reskilling and upskilling programs.
James Cockett, senior labor market economist at the CIPD, said AI offers “huge potential to improve productivity and performance” but warned it also risks “leaving a lot of people behind”.
“Young talent will be the hardest hit by AI, but we need a nationwide initiative to reskill and upskill people of all ages and career stages,” he said.
Among employers anticipating AI-related layoffs, a quarter (26 percent) believe more than 10 percent of their workforce could be eliminated within a year.
Overall, the net employment balance – the difference between employers planning to increase their workforce and employers planning to reduce their workforce – remains modest at +9. In the public sector, confidence slipped further into negative territory, falling from -6 to -8.
A government spokesman said ministers were focused on helping workers “take advantage of the huge opportunities AI offers”.
“We are working with leading technology companies to train a fifth of our workforce in AI over the coming years and are investing £187 million to bring digital and AI learning directly into classrooms and communities,” they said.
They added that the government’s AI Growth Zones are already creating “thousands of new jobs and skills opportunities” across the UK, helping to ensure “working people can share in the benefits of AI.”
