UK Minister Warns of 'Unprecedented' AI Job Losses, Demands Contingency Plan

The UK government must "take seriously the possibility of an unprecedented impact on the jobs market" caused by artificial intelligence, AI Minister Kanishka Narayan said at a fringe meeting during the Labour Party conference.

Narayan said there was no evidence so far of an overall reduction in jobs as a result of AI. But one of his priorities, he said, was to have a contingency plan in place for worst-case scenarios.

"If it's going to hit us in a big way, you are going to want to be as ahead of the curve as possible," he told the meeting.

The warning comes with numbers attached. Carsten Jung of the IPPR think tank said: "In a worst case scenario you could have about 8 million jobs being negatively affected by this." Jung said the think tank was working on a "pandemic preparedness" report on AI labour market disruption.

From boring tasks to high-level reasoning

Jung acknowledged that the "stark scenarios" the IPPR produced in 2024 were "to some extent" wrong. But he argued that AI had evolved rapidly since then, moving from doing "boring" tasks to "more high-level reasoning and creative tasks". The level of industry adoption remained low so far, he said, and AI might not ultimately trigger massive job losses. Even so, he claimed it would still have a bigger impact on the labour market than the industrial revolution.

"We are not preparing enough for something quite big that's coming," he told the meeting.

The exposure figures are stark. According to Jung, about 11% of UK jobs are "highly exposed" to being replaced by AI chatbots, "led by secretarial and administrative occupations". With the rise of more sophisticated agentic AI, he argued, that proportion "could rise to about 60% of tasks across the UK economy".

Retraining, tax tweaks and the cost of readiness

Jung said the government needed to be ready to retrain service sector workers. It also needed measures to "slow down the transition slightly" to keep people in their jobs. That could involve redesigning tax structures to "make it a bit more attractive to hold on to workers than automating them," he said.

He warned, though, that "a lot of the policies we might want to do in a really severe disruption scenario will cost a lot of money". The risk is amplified because the UK is more of a service-based economy than other G7 nations.

Jung also flagged a gender gap in exposure. Women, he said, are "40% more exposed than men" to the threat of AI because a higher proportion of them work in service jobs.

'Silent adoption' may be hiding the impact

Narayan told the meeting that the impact of AI might have been underestimated because of the "silent adoption" of the technology by workers, which does not show up in industry surveys.

UK firms had reported "no aggregate impact in the overall labour market today," the AI minister said. But one tech firm had told him it had hired fewer people because tasks had been automated — "so the actual net impact might not be fully captured".

Narayan said he was determined that workers would have a voice in the transition to AI. He promised "much better transparency when AI and technology is adopted" so that any productivity gains could be measured. Contingency planning, he added, could involve changes to "labour market policy" and "even where we might go on some aspects of regulation".

Mike Clancy, general secretary of the Prospect trade union, welcomed the government's commitment to giving workers more of a say. But he warned against "creating the conditions in which working people become victims" of AI.

Miliband fires warning at 'tech titans'

Foreign Secretary Ed Miliband used his own conference speech to target "tech titans" he said could not be relied on to manage AI safety risks alone. While some tech companies were "calling for us to act", others "are saying we should leave it all to them", he said.

"The lesson of history is that we cannot leave it to corporations to put in place the guardrails to serve the public interest," Miliband argued. "It is neither their purpose nor their motive, theirs is to maximise profits. We cannot and will not allow that to come at the expense of our children or indeed humanity."

He called the "technological progress" from AI "inspiring" but said the "threat it poses according to its own inventors is daunting". The UK, he said, would confront those "urgent risks" in part through its G20 presidency next year, using it to "lead the efforts to manage AI so we keep our country and our world safe".

With contingency planning, tax redesign and G20 diplomacy now all in play, the question for UK plc is whether the preparation outpaces the technology.