AI-driven disruption could displace between 1 and 3 million private sector jobs in the UK over the next two decades, according to a new report from the Tony Blair Institute (TBI).
However, the thinktank also suggests that the rise in unemployment will be relatively contained, with long-term losses predicted to remain in the “low hundreds of thousands” as AI spurs the creation of new roles.
TBI’s Impact of AI on the Labour Market report estimates that 60,000 to 275,000 jobs could be displaced annually, a “relatively modest” impact when compared to typical job losses of around 450,000 per year in the UK. AI’s net impact, the report predicts, will ultimately drive greater dynamism in the labour market, creating new roles as workers transition to jobs that require uniquely human skills, such as creative problem-solving and interpersonal interactions.
The TBI forecasts suggest that while AI will initially contribute to a rise in unemployment—up to 180,000 by 2030—the technology could also boost GDP by as much as 6% by 2035, creating demand for skilled workers in emerging sectors.
Jobs involving routine cognitive tasks, including administrative, secretarial, and customer service roles, are predicted to be the most impacted as AI optimises time-intensive processes. Sectors generating vast amounts of data, such as banking and finance, are also likely to see significant displacement due to the availability of AI models capable of handling complex information at scale. Conversely, roles that rely on complex manual labour, such as construction, may be less affected by the rise of AI.
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