AI and the workforce: measuring impact in practice
As organisations accelerate their adoption of AI, governments are turning their attention to its real-world impact on jobs, skills and productivity. In the UK, businesses are now being asked to share data on the effect of AI on their workforce, signalling a shift towards more evidence-based AI policy.
What is the Government seeking to understand?
The UK government is seeking aggregated insights from businesses on the ways in which AI is reshaping the world of work. This includes changes to roles and responsibilities, evolving skills requirements, the impact on employment levels and job quality, and the broader economic and labour market impacts.
The UK government is seeking to understand “what is changing inside firms” in practice through its ‘AI Economics Institute’. The UK government has stated: “This will be a key part of our efforts to roll out AI in a way that drives growth and spreads opportunity.” Although participation is voluntary, the initiative reflects a broader shift towards measuring the actual impact of AI rather than speculating about it.
What are the concerns with regards to AI and the labour market?
AI is already driving efficiency gains across many organisations, but there is still some cause for concern about its effects on the labour market. In particular, there are concerns that automation may reduce entry-level roles, which could exacerbate pressures in youth employment. This has also led to concerns about longer-term skills gaps if fewer junior employees are able to gain experience. However, Business Secretary Peter Kyle has argued that AI will contribute to the creation of higher-paid roles.
This reflects differing views on the extent and nature of AI’s impact on the workforce, rather than a consensus. By seeking input directly from businesses, the government is indicating a focus on understanding the practical impact of AI on the workforce, rather than relying solely on forecasts.
Some organisations have already linked restructuring decisions to AI-driven efficiencies. For example, large employers have cited AI and reskilling programmes in connection with workforce reductions. For instance, BT announced plans in 2023 to cut 55,000 jobs by 2030, 10,000 of which to be directly replaced by AI.
Although the government has said it will not force companies to share data, some businesses are concerned that the current “light-touch” approach could become more onerous, especially since companies are already expressing concerns about increasing regulatory burdens and consultations.
Looking ahead
The UK’s approach reflects a broader shift in AI policy, moving from prediction to measurement of disruption. The UK has expressed its ambition to inform AI policy with real-world economic evidence, thereby positioning itself at the forefront of this approach.
For businesses, this suggests that the impact of AI on the workforce will likely remain an area of ongoing policy focus.
