UK firms are automating roles, but nowhere near ready to outright replace them

The doom-sayers appear to be wrong about AI leading to job losses, with government figures showing that UK businesses are using the technology to automate roles and support staff, not replace them.

New data from the Office for National Statistics (ONS) suggests that firms are far more likely to use AI to improve operations than they are to reduce staffing levels.

Researchers found that, when asked how AI was being used internally, the most frequent answer was 'improving business processes', particularly among organizations with more than 50 employees.

AI adoption among UK businesses with 10 or more employees has almost tripled since late 2023, rising from around 12% to 35%. Larger organizations are leading the way, with 49% of those with 250 or more employees saying they use at least one AI system, compared with 28% of businesses with nine employees or fewer.

Notably, fewer than 10% of firms have reduced employee headcount as a result of AI, according to ONS figures.

But they're not taking on extra staff either, which is a problem. Just 1% of the smallest businesses and 1.2% of the largest businesses report increasing headcount as a direct result of AI. Around half of businesses report no change at all.

UK firms ramp up AI skills training

Businesses mostly said they were integrating AI skills into their workforce through training or reskilling existing staff.

Over 60% are doing so to reduce barriers to AI expertise within their workforce, and around 40% of medium- to large-sized businesses report integrating AI skills through training.

According to Fasthosts, which has analysed the data, fears that workers across multiple industries will be replaced may be unfounded.

"Economists are pushing to distinguish between task automation, where AI automates specific activities, and job automation, where an entire role disappears," the researchers said.

"Current evidence suggests that the former is occurring much faster than the latter, for example with tools such as AI receptionists which can step in by picking up routine enquiries when staff are unavailable. AI is primarily being used to automate repetitive tasks within existing jobs, rather than eliminate roles altogether."

Long-term gains

The World Economic Forum (WEF) predicts that technological change could create 170 million jobs while displacing 92 million by the end of the decade, resulting in a net increase of 78 million jobs.

As ITPro recently reported, UK firms specifically view AI as a long-term growth driver when it comes to jobs.

Analysis conducted by Box found 65% of business leaders expect their overall headcount to increase in the next three years, with just 14% expecting numbers to decrease.

Of those using agents, only 8% said the technology was eliminating existing roles. If anything, it was creating demand for new AI-focused expertise.

Nearly half are hiring ‘AI agent operators’, for example, with 32% adding ‘workflow automation specialists’.

Other key areas such as security and compliance, governance, and ethics all recorded significant AI-focused job growth.

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