Training workers to use artificial intelligence will be “key” to managing disruption in the UK labor market, according to Andrew Bailey, who said there are already signs that AI is reshaping jobs and recruitment patterns.
Speaking at a conference in Saudi Arabia on Sunday, Bailey said the long-term impact of AI on the workplace remains “highly uncertain”, but warned that early indications point to meaningful change.
“In the UK, over the past three years, new online vacancies in the most AI-exposed roles have fallen by twice as much as the less exposed group,” he said.
“On the positive side though, there has been a huge increase in new jobs, such as integrating AI tools into the workflow processes of firms.”
Bailey cautioned against jumping to simplistic conclusions about AI’s impact on jobs, stressing that education and retraining will be key to ensuring workers aren’t left behind. “Education and training in AI skills will be key,” he said. “We should not resort to oversimplified conclusions about employment outcomes.”
His comments came at the end of a volatile week in global markets, where renewed concern over artificial intelligence wiped more than $1 billion off the combined value of the world’s biggest technology and software companies.
Investors’ nerves were shaken in part by the launch of a new product from Anthropic, one of the world’s leading AI developers. The company presented tools aimed at automating legal work such as contract review, as well as its latest model Claude Opus 4.6, which can analyze complex information and generate presentations and spreadsheets.
The development fueled fears about job losses and business model disruption, prompting a drop in share prices among UK-listed companies that appear to be most exposed to AI. These include RELX, London Stock Exchange Group, and Sage.
At the same time, concern grew that AI excitement may have gotten ahead of reality in the US tech sector. Amazon, Alphabet, Meta and Microsoft have collectively committed to spending an estimated $660 billion this year on data centers and advanced computer chips to support AI development.
Fears that such large investments may not bring enough returns have moderated share prices, adding to broader market volatility. The pullback follows years of strong gains in US tech stocks, driven by investor optimism about AI-led manufacturing gains, optimism that has also raised concerns about a potential bubble.
Bailey said there are signs of “fear of missing out” in markets, fueled by claims that AI represents a structural break from previous technology cycles. “We have seen arguments along the lines of ‘this time is different’, for example because of the expected productivity benefits of AI,” he said.
He warned that this narrative risks complacency among investors and policy makers alike. “Expectations of AI-driven productivity gains can be disappointing,” he said.
Without warning, Bailey noted the broad optimism and long-term economic potential of AI and robotics. He said he believes technology can increase productivity and growth by redefining repetitive tasks and creating new types of jobs.
However, he added that the transition will not be painful. “Some industries may decline, others may grow, and affected workers will need to retrain to adapt to their skills,” he said, stressing that investment in training will be a key factor in shaping the future of the UK labor market.
