AI creates more jobs in UK but regional inequalities may grow

A new study has found that artificial intelligence-based technologies have created new jobs in the United Kingdom. The speed of change is contrasting in different regions, though.

More than 75% of firms that took part in a survey conducted by the Institute for the Future of Work (IFOW), Imperial College London and Warwick Business School reported that the adoption of AI, robotics and automated equipment has had a positive impact on jobs and created new roles within companies. Besides, the majority of firms said that job quality had improved.

North of 1000 UK firms were asked about their adoption of the new tech over the past three years, and the majority confirmed they were using AI and other automated tools. 78% of these companies said this had resulted directly in the creation of new jobs.

“This report not only highlights that the adoption of AI is well under way across UK firms, but also that it is possible for this tech transformation to lead to both net job creation, and more ‘good work’ – great news as we try to solve the UK’s productivity puzzle,” said Anna Thomas, director of IFOW.

The report’s findings contradict fashionable concerns about the possibility of AI-induced job losses. The document’s authors say “dramatic, speculative headlines” are to blame.

That’s because it’s easy to say that in a couple of decades there will be no jobs left – and quite boring to claim that the nature of jobs will simply change as a result of more automation.

Survey respondents were senior executives from firms with more than 20 employees across various sectors who had responsibilities for the adoption of new technologies, and management practices for human resources.

47% of respondents said AI and automation had eliminated positions within their company, almost 67% reported the technology had created new positions.

However, the report also said the pace at which automation was spreading through the labor market could exacerbate regional inequalities across the country and result in worrying tensions.

“Automation's transformation of the labor market could exacerbate existing regional and demographic inequalities and could lead to serious erosions in job quality, with all of the other negative impacts that that will bring,” says the report.

These regional disparities are well-known. The quality of life and the pace of innovation is just so much higher in London, the capital, and surrounding areas.

According to a 2023 study (PDF) by the Mossavar-Rahmani Center for Business and Government at the Harvard Kennedy School, the UK’s regional economic inequality problem today is best characterized by productivity differentials between London and the greater South East of England vs. the rest, largely driven by the underperformance of non-London cities.

Job loss and the erosion of work quality is certainly possible, and regional inequalities can exacerbate it, the IFOW report agrees: “This invites urgent policy intervention aimed at ensuring that risks are anticipated and opportunities harnessed across the country.”

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