The UK is preparing contingency plans for the possibility that artificial intelligence could cause unprecedented disruption to the jobs market, raising important questions about job security, recruitment and the skills workers may need in an increasingly automated economy.
AI Minister Kanishka Narayan has said the Government must take seriously the possibility of AI having an “unprecedented impact on the jobs market”, with preparations being considered for a severe scenario in which technological change substantially disrupts employment.
However, there is an important distinction for workers: there is currently no evidence that AI has caused an overall reduction in UK employment.
The Government is preparing for what could happen rather than declaring that mass AI unemployment is already happening.
According to City AM’s report on the Government’s contingency planning, possible responses could involve changes to labour-market policy and potentially aspects of regulation if disruption became sufficiently severe.
AI may change recruitment before redundancies appear
One of the most important issues raised by Narayan concerns how the employment impact of AI is measured.
A company does not necessarily need to make existing workers redundant for AI to reduce employment opportunities.
Instead, businesses could simply recruit fewer people because technology performs some of the tasks previously assigned to new employees.
Narayan described being told by one technology company that it was recruiting fewer workers because some activities had been automated.
That distinction matters.
If an organisation employs 1,000 people and introduces AI but makes nobody redundant, the immediate employment figures might show little change. But if that organisation subsequently recruits 50 people instead of the 100 it might previously have required, AI may still be influencing employment.
For workers entering the labour market, particularly younger people seeking their first professional position, that could become increasingly important.
Entry-level jobs could face particular pressure
Government research already acknowledges concerns about the effect of AI on graduate and entry-level employment.
The Department for Science, Innovation and Technology’s assessment of AI and the UK labour market examines both the opportunities and risks created by increasingly capable AI systems.
Separate analysis referenced by Skills England suggests that businesses highly exposed to AI have experienced reductions concentrated particularly around junior positions.
The Skills England annual skills report 2026 says research has found AI-exposed firms reducing total employment by 4.5%, with junior positions falling by 5.8%.
It also highlights evidence that graduate online job advertisements fell substantially during 2025.
That does not establish that AI alone caused those reductions. Britain’s recruitment market has simultaneously been affected by weaker economic conditions, employer costs, business uncertainty and other factors.
But it demonstrates why policymakers are watching entry-level employment particularly closely.
Worst-case scenario could affect millions of jobs
The most dramatic estimate comes from the Institute for Public Policy Research.
The think tank has previously modelled a worst-case scenario in which approximately eight million UK jobs could potentially be negatively affected by AI.
That figure requires considerable context.
It is not a forecast that eight million people will lose their jobs.
It represents a severe scenario examining what could happen if organisations use generative AI extensively to replace human activity without sufficient job creation, worker transition or intervention.
City AM reports that around 11% of British jobs are considered highly exposed to replacement by current AI chatbot technology, with administrative occupations among those particularly exposed.
As AI develops from systems that primarily generate text and analyse information towards more capable autonomous agents, the range of tasks potentially affected could expand.
That is why contingency planning matters before rather than after major disruption occurs.
Britain’s jobs market is already difficult
AI is also arriving at a time when the wider employment market is under pressure.
The latest Office for National Statistics labour-market figures show that UK payrolled employee numbers fell by an estimated 101,000 between July 2025 and July 2026.
The provisional August estimate showed an annual reduction of approximately 145,000 payrolled employees.
Meanwhile, UK vacancies fell to approximately 702,000 during June to August 2026, their lowest level since early 2021.
We recently examined this changing employment environment after UK job vacancies fell for the 34th consecutive month.
The important question is therefore how much future employment weakness can genuinely be attributed to AI and how much reflects the wider economic environment.
Workers deserve clarity rather than sensational predictions.
AI does not automatically mean fewer jobs
There is another side to the debate.
AI can automate work, but it can also increase productivity, support existing employees and create entirely new occupations.
Skills England says around 70% of UK workers are employed in occupations containing tasks that AI could potentially perform or enhance.
The word enhance is important.
Exposure to AI does not necessarily mean that an occupation disappears.
An accountant using AI to analyse information remains an accountant. A software developer using AI to assist with coding remains a developer. A customer-service worker using technology to retrieve information more quickly may become more productive rather than redundant.
Government analysis therefore considers both automation and augmentation.
Research cited by Skills England suggests AI could increase UK productivity growth by between 0.4 and 1.3 percentage points over the next decade.
If those productivity gains translate into business growth, investment and new industries, AI could also create employment opportunities.
The eventual outcome will depend partly on how employers deploy the technology.
What happens if AI makes your job redundant?
For workers, technological change does not remove existing employment rights.
An employer introducing AI or automation may decide that particular roles are no longer required. Where that results in genuine redundancy, normal redundancy principles and employment protections can still apply.
Workers facing this situation should understand issues including consultation, selection procedures, notice, redundancy pay and whether suitable alternative employment is available.
Our UK redundancy rights guide provides practical information for workers concerned about their position.
Workers should also distinguish between a role disappearing and a role changing.
If AI removes certain tasks but the underlying job continues, the employment implications may be very different from a situation where the employer determines that the position itself is no longer required.
Retraining could become increasingly important
Perhaps the biggest long-term challenge is skills.
If AI eliminates some tasks while creating demand elsewhere, workers need realistic routes from declining occupations into growing ones.
That means reskilling cannot simply be discussed after large numbers of people lose their jobs.
Workers may increasingly benefit from developing abilities that complement AI: judgement, communication, specialist knowledge, technical skills, management, problem solving and the ability to use AI systems effectively.
Recent recruitment announcements demonstrate that opportunities continue to exist.
We have reported on HSBC creating 1,000 entry-level opportunities and Balfour Beatty planning around 2,000 additional UK jobs.
The employment picture is therefore not simply one of machines replacing people.
Some occupations may shrink, others will change and entirely new forms of employment are likely to emerge.
Workers need transparency when AI enters the workplace
Narayan has also indicated that workers should have greater visibility over how artificial intelligence is introduced within organisations.
That could become increasingly important.
AI is already capable of influencing recruitment, productivity monitoring, scheduling, performance analysis and workplace decision-making.
Workers should understand when important decisions concerning their employment are being influenced by automated systems and what human oversight exists.
The Workers Union believes technological progress and worker security should not be treated as opposing objectives.
Britain can benefit from AI while still recognising that major technological transitions can create genuine uncertainty for working people.
The Government’s decision to prepare for a severe employment scenario should therefore be understood for what it is: contingency planning rather than a prediction of mass unemployment.
There is no evidence at present that AI has caused an overall reduction in UK employment.
But there is enough evidence of changing recruitment patterns, automation and rapidly improving technology to justify preparing workers for what could come next.
The central challenge will not simply be whether Britain adopts AI.
It will be whether workers are given the skills, transparency, opportunities and workplace protections necessary to benefit from the transformation rather than being left behind by it.
