One in six employers will use artificial intelligence to shrink their workforce over the next year as they respond to higher costs imposed by the UK government, according to new research.
The Chartered Institute of Personnel and Development, the professional body for the human resources sector, said overall hiring intentions are among the weakest since the pandemic.
Of those surveyed, white collar jobs were seen to be most at risk with 62% forecasting cuts in junior managerial, clerical, professional and administrator roles. A quarter expect to cut staff by 10%.
A significant hit will be taken by large private sector companies, with 26% expecting headcount to fall. That compares with 17% in the private sector overall and 20% in the public sector.
The CIPD said the findings should be a warning to Chancellor Rachel Reeves to avoid further measures in her budget this month that will further weaken hiring following her controversial hike in labour costs last year.
James Cockett, senior labour market economist at the CIPD, said: “We need to see a stronger focus by the government and employers on longer-term workforce planning and investment in skills to help people use AI effectively in their roles or transition into different jobs or occupations as AI use grows.”
The CIPD said that despite the planned cuts, there was an expectation that staff basic pay would rise by 3%.
Official labour market figures on Tuesday are due to show a small slowdown in wage growth. Economists polled by Reuters forecast regular pay in the three months to September to have increased by an annual 4.6%, slightly below the 4.7% rise in the month before.
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