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\t\tThe workplace is bifurcating into roles that AI can do better and faster\t<\/p>\n\t\t\tSunday 28 December 2025 10:52 am\n\t\t\t<\/p>\n
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\t\tThe workplace is bifurcating into roles that AI can do better and faster\t<\/p>\n
Britain\u2019s labour market has probably never felt more precarious than it does now, as the struggling economy and the rapid rise of AI take effect.<\/p>\n
Redundancies are at their highest since the pandemic, unemployment has risen to 5.1 per cent<\/a>, and entry-level opportunities, the traditional stepping stones for grads and young workers, have all but dried up.<\/p>\n Job-search platform Indeed reports that grad roles have fallen by 13 per cent since 2024, while overall job postings are down by almost a fifth compared to pre-pandemic levels.<\/p>\n Low-wage sectors, from retail to hospitality, have been hit hardest, squeezed from all sides by rising National Insurance contributions, minimum wage increases, or soaring operational costs.<\/p>\n Overlay this with an unprecedented rise in AI adoption, and the picture doesn\u2019t get much rosier: 2025 saw tens of thousands of jobs disappear in the name of automation.<\/p>\n Amazon eliminated 14,000 corporate roles; Microsoft cut around 15,000; Salesforce slashed 4,000.<\/p>\n Crowdstrike, Workday, and IBM also reduced headcount while doubling down on AI investment this year.<\/p>\n \u201cIn 2026, organisations face a dual challenge: a growing talent crisis inside their own walls and increased pressure to use AI responsibly\u201d, said Dan Pell, UKI country manager of Workday.<\/p>\n \u201cThe rise of microshifting shows a shift toward more flexible, AI-assisted work rhythms, where short, focused bursts replace the traditional \u2018always on\u2019 model\u201d.<\/p>\n So the verdict for 2026 goes as follows. The workplace is bifurcating into roles that AI can do better and faster, and into those that demand oversight, creativity or judgement.<\/p>\n The rise of AI agents<\/p>\n What\u2019s more, AI agents <\/a>are increasingly being trialled across industries on both sides of the Atlantic.<\/p>\n According to a recent Loopex Digital survey, UK and US firms report that these agents can dramatically cut time spent on repetitive tasks, allowing human teams to focus on higher-value work.<\/p>\n In London, financial institutions like Barclays and Lloyds are experimenting with AI agents to streamline basic client queries and compliance checks.<\/p>\n Meanwhile, across the pond in New York, JPMorgan and Goldman Sachs are deploying agents to assist with research and routine financial modelling.<\/p>\n Retailers, including Marks and Spencer (M&S) in the UK and Target in the US, are using agents to generate personalised customer service. Both firms have claimed this investment is set to improve engagement and operational efficiency.<\/p>\n \u201cBy 2026, up to 90 per cent of data entry tasks could be automated\u201d, said consultancy giant McKinsey.\u00a0<\/p>\n AI-driven virtual assistants are also expected to handle most routine inquiries by 2027.<\/p>\n But we have seen that AI is not a wholesale replacement for humans, and that complex decision-making, nuanced client interactions, and strategic oversight still require human judgment.<\/p>\n Mantas Lukauskas, AI tech lead at Hostinger, explained that \u201cwhile AI can streamline accounting and risk assessment, high-level financial reasoning still requires human expertise\u201d.<\/p>\n \u201cThe question isn\u2019t whether AI will transform industries, but how quickly companies and workers can adapt\u201d, he added.<\/p>\n A two-tier labour market<\/p>\n Meanwhile, the economic backdrop exacerbates inequality in employment.<\/p>\n James Cockett, senior labour market economist at the CIPD, warns: \u201cWe don\u2019t anticipate a major recruitment rebound in the new year\u201d.<\/p>\n Most worryingly perhaps, \u201cunemployment is set to peak towards the middle of the year, and wage growth will continue to decline\u201d, he added.<\/p>\n Lower-skilled roles are being squeezed most aggressively.<\/p>\n Giles O\u2019Halloran of Go2work says that \u201cdemand for lower-skilled, entry or commodity-type jobs is declining, whereas the demand for tech, digital and high-skilled roles will remain highly selective.\u201d<\/p>\n And at the same time, the broader slowdown in the jobs market means competition is fierce even for high-skilled positions.<\/p>\n Georgina Kvassay, a City interview coach, has claimed: \u201cStrong performers continue to walk away from slow, disorganised hiring processes. AI should support hiring, not run it.\u201d<\/p>\n White collar reorganisation<\/p>\n AI is reshaping the mid- and upper-tier of the workforce, too.<\/p>\n OpenAI\u2019s new model, GPT-5.2, now outperforms junior analysts in finance tasks, putting an estimated 27,000 UK banking roles at risk.<\/p>\n \t\t\t\t\tRead more<\/p>\n