One in six UK employers expect artificial intelligence to reduce their workforce size within the next 12 months, according to a major new survey highlighting potential disruptions to white-collar employment. Research by the Chartered Institute of Personnel and Development (CIPD) indicates that 62% of those anticipating job losses believe clerical, junior managerial, professional, or administrative roles will be the first affected as automation progresses.
The findings, released ahead of this month’s Budget, derive from the CIPD’s latest Labour Market Outlook—a survey of over 2,000 employers—and underscore the growing tension between AI-driven productivity gains and threats to early-career jobs. The impact is expected to be most significant among large private sector companies, where over a quarter (26%) of employers foresee headcount reductions due to AI. This contrasts with 17% across the private sector overall and 20% in the public sector.
This warning comes as firms balance AI adoption with high employment costs and sluggish growth since last year’s Budget. Global tech and professional services groups have already initiated restructuring. Last month, Amazon announced it would cut 14,000 corporate roles, citing generative AI as the most transformative technology since the internet. Meanwhile, PwC reduced its global workforce by 5,600 in the past fiscal year—its first major downsizing since the 2008 financial crisis—despite investing nearly $1.5 billion in expanding its AI capabilities.
Recruiters note that employers are increasingly cautious about hiring as they aim to control costs while achieving efficiency gains through automation. Separate research by ManpowerGroup, tracking hiring plans across 42 countries, found the UK faces one of the sharpest recruitment slowdowns globally, attributing this to a “perfect storm of cost pressures, AI disruption, and policy uncertainty.”
The CIPD has urged the government to support workers most vulnerable to AI, especially those in early-career or lower-level professional roles in finance, insurance, IT, and administrative services, with retraining and upskilling programmes. James Cockett, senior labour market economist at the CIPD, acknowledged AI’s “huge potential for improving productivity and performance” but cautioned it also risks “leaving many people behind.” He stressed the need for a national initiative to retrain and upskill individuals of all ages and career stages.
Among employers expecting AI-related redundancies, a quarter (26%) believe more than 10% of their workforce could be cut within a year. Overall, the net employment balance—the difference between employers planning to increase and those planning to reduce headcount—remains modest at +9. In the public sector, confidence has declined further, falling from –6 to –8.
A government spokesperson stated that ministers are focused on helping workers “take advantage of the huge opportunities” AI presents. “We’re working with leading tech firms to train a fifth of our workforce in AI over the coming years and investing £187 million to bring digital and AI learning directly into classrooms and communities,” they said. The government’s AI growth zones, they added, are already creating “thousands of new jobs and skills opportunities” across the UK, ensuring that “working people can share in the benefits of AI.”
