Asked by: Lord Taylor of Warwick (Non-affiliated - Life peer)
Question to the Department for Work and Pensions:
To ask His Majesty's Government what assessment they have made of the potential impact of AI on the labour market, and how that assessment informs their policies on training, skills and labour market resilience.
Answered by Baroness Sherlock - Minister of State (Department for Work and Pensions)
The government is committed to ensuring that people have access to good, meaningful work. This involves adapting to structural changes in the labour market, including the emergence of new technology and other changes. While AI-driven changes in the labour market may bring challenges, they also offer new opportunities for economic growth, job creation, and increased productivity.
We are already witnessing AI’s impact on the labour market: transforming the workplace, demanding new skills and changing the jobs landscape. We continue to monitor trends in the labour market as the impact of AI evolves. We remain mindful of this impact and its effect on the UK workforce and DWP customers, whilst working to harness the benefits that AI can bring.
We are continuing to deliver our Get Britain Working reforms to ensure we provide people with access to good work and training opportunities fit for the future. DWP has a strong track record of supporting people to re-skill (where needed) to re-enter work.
Government funds post-16 education, training and qualifications through 16-19 funding, the Adult Skills Fund and apprenticeships. This can support people at all stages of their lives to train and reskill in a range of sectors – including in response to changes in technology such as AI.
Government is investing £187 million to bring digital and AI learning into classrooms and support over 4,000 graduates, researchers, and innovators in areas like AI, cyber security and computer science. We will train 7.5 million UK workers in essential AI skills by 2030 through our new industry partnership with major tech players. Skills England is working with DSIT to mobilise the government-industry partnership that will deliver on this commitment.
Asked by: Lord Taylor of Warwick (Non-affiliated - Life peer)
Question to the Department for Work and Pensions:
To ask His Majesty's Government what assessment they have made of the rise in the UK unemployment rate to 5.1 per cent between August and October 2025; and what steps they are taking to support employment opportunities for young people.
Answered by Baroness Smith of Malvern - Minister of State (Department for Work and Pensions)
The UK’s unemployment rate is now 5.1%.
But since the start of 2025 363,000 more people are in employment – outweighing the increase in unemployment over the same period (280,000).
At the end of the last Government the UK was the only country with economic inactivity higher - rather than lower - than before the COVID-19 pandemic. Since then, we have seen a significant fall in economic inactivity as people reengage with the labour market. Our economic inactivity rate (21.0%) has fallen to its joint lowest level in over five years (and was last lower in January to March 2020).
The Government’s number one mission is to grow the economy and raise living standards across the UK. However, almost one million young people across the UK are currently not in education, employment, or training (NEET). That is why our manifesto set out the ambition to transform young people’s prospects by ensuring every one of them has the chance to earn or learn through a Youth Guarantee.
We have already taken the first steps towards delivering a Youth Guarantee, to ensure that all 16–24-year-olds in Great Britain can access support to find work, training, or an apprenticeship. We have launched Youth Guarantee Trailblazers in England, announced funding to almost double our Youth Hubs across Great Britain, and we recently launched an Independent Report into Young People and Work, to identify potential areas for reform to better support young people with health conditions and disabilities.
We are now going further through an expansion of the Youth Guarantee. This expansion is backed by a £820 million investment over the Spending Review period to reach almost 900,000 young people, including through Youth Hubs in every area in Great Britain and a new Youth Guarantee Gateway, offering a dedicated session and follow-up support to 16-24–year-olds on Universal Credit. This investment will also create around 300,000 more opportunities to gain workplace experience and training and provide guaranteed jobs to around 55,000 young people aged 18-21.
Taken together, these measures show the Government’s commitment to backing young people, transforming lives, driving the economy and ensuring background is no barrier to success. Delivered in partnership with local government and devolved authorities, they will ensure no young person falls through the cracks.
Asked by: Lord Taylor of Warwick (Non-affiliated - Life peer)
Question to the Department for Work and Pensions:
To ask His Majesty's Government what estimate they have made of the number of pensioners whose incomes will be below the minimum retirement living standard in 2040.
Answered by Baroness Sherlock - Minister of State (Department for Work and Pensions)
This Government is committed to delivering greater security in retirement for future retirees. The Pensions Scheme Bill will put in place bigger, better pension schemes that have the scale to deliver better returns, a strong Value for Money framework to ensure schemes are delivering these returns, and new Guided Retirements to support people to turn their savings into an income in retirement.
The Government has also revived the Pensions Commission, which is reviewing our pensions system as a whole and the retirement outcomes it delivers, with a focus on adequacy, fairness and sustainability.
DWP’s latest estimate, in July 2025, found around 13% of current working-age individuals were on track to have an income level in retirement below the Pensions UK Minimum Retirement Living Standard.
For those becoming a pensioner in the 2040s, it is estimated that 15% will fall below the Pensions UK Minimum Standard, the equivalent of around 1 million individuals.
For further detail please see:
Analysis of Future Pension Incomes 2025 - GOV.UK
analysis_of_future_pensions_incomes_data.xlsx – See table 4
Asked by: Lord Taylor of Warwick (Non-affiliated - Life peer)
Question to the Department for Work and Pensions:
To ask His Majesty's Government what steps they are taking to develop workforce and education strategies in response to the growth of AI-native businesses with minimal staff.
Answered by Baroness Smith of Malvern - Minister of State (Department for Work and Pensions)
The government is taking steps to prepare the workforce for the future through its Industrial Strategy. We are ensuring that skills and employment support are aligned with key economic priorities, including transformative technologies like artificial intelligence (AI).
The Post-16 Education and Skills Strategy will set out plans to build a system that provides the skills that learners need to thrive in work and life and supports delivery of the Plan for Change.
Digital skills are embedded across occupational standards, influencing T-Levels, Higher Technical Qualifications, and apprenticeships. From April 2026, new short courses will be introduced in England in areas such as digital and AI, funded by the Growth and Skills Levy.
Skills England has released three data-driven reports to support decision-making and development of targeted training solutions. These will ensure that skills provision meets economic needs, including in sectors most affected by AI, and will shape sector-specific packages responding to future workforce demands.
Asked by: Lord Taylor of Warwick (Non-affiliated - Life peer)
Question to the Department for Work and Pensions:
To ask His Majesty's Government what steps they are taking to strengthen employment opportunities in sectors experiencing the sharpest decline in job opportunities.
Answered by Baroness Sherlock - Minister of State (Department for Work and Pensions)
Following a peak during the pandemic, vacancies are returning to their long-term average. There are currently 728k vacancies, slightly above the long-term series average of 696k.
We recognise the need to provide working-age adults with the support they need to pursue opportunities in the workforce, which is essential for economic growth.
We are already delivering the biggest overhaul of jobcentres in a generation, backed by £240 million investment to boost employment.
By bringing apprenticeships, adult further education, skills training, careers guidance, and Skills England under DWP’s remit, we’re creating strong pathways to support the millions of people across the country.
This will mean a greater focus on adult skills and career outcomes, getting people into skilled work in sectors that need labour – like construction.
Part of our approach is the use of DWP’s Sector-based Work Academy Programmes (SWAPs) that help employers with immediate and future employment needs by upskilling benefit claimants to fill local job vacancies.
Asked by: Lord Taylor of Warwick (Non-affiliated - Life peer)
Question to the Department for Work and Pensions:
To ask His Majesty's Government what assessment they have made of the number of graduate-level jobs currently available, and whether the increased use of artificial intelligence is affecting those employment opportunities.
Answered by Baroness Sherlock - Minister of State (Department for Work and Pensions)
Data from the Department for Education (Graduate labour market statistics, Calendar year 2024 - Explore education statistics - GOV.UK) shows that graduates aged 16-64 years old in 2024 in England continue to have high employment rates, which exceed the employment rates of non-graduates:
Graduates are also more likely than non-graduates to be in high-skilled work than non-graduates and the proportion of working-age graduates in high-skilled work has increased on the year:
This data also refers to people who are aged 16-64 years old in England in 2024. High-skilled employment is defined as being in Standard Occupational Classification 2020 major occupation groups 1-3.
The Office for National Statistics publish data on labour demand by occupation and how it is changing over time, which can be found here:
Textkernel new online job adverts - Office for National Statistics
No current assessment has been made on the impact of artificial intelligence (AI) on graduate job opportunities.
The Department for Education has published research on the potential impact of AI on different occupations:
GOV.UK Impact of AI on UK jobs and training
Asked by: Lord Taylor of Warwick (Non-affiliated - Life peer)
Question to the Department for Work and Pensions:
To ask His Majesty's Government how they expect their proposed changes to welfare payments in England to encourage more people into the workforce; and what is their estimate of the number of individuals who will enter the workforce as a result of those changes.
Answered by Baroness Sherlock - Minister of State (Department for Work and Pensions)
The reform proposals set out in the Pathways to Work Green paper on 18 March 2025, mean that people will get more support into work. We will rebalance payments in Universal Credit, offer help for people to get into work as quickly as possible and deliver the first ever permanent, above inflation rise to the standard allowance of UC. As part of rebalancing spending towards work over welfare, we will invest an additional £1 billion a year by 2029/30 to shape a new package of employment, health and skills support to make the system pro-work and reduce perverse incentives.
The changes we are consulting on are intended to galvanise a cultural shift towards more inclusive and accessible workplaces. We want to ensure that we target Government support to maximise the number of people we support. Together with the wider range of measures announced in Get Britain Working, we aim to increase the overall number of people in work. As we develop the reform proposals, we want to ensure that we are maximising existing opportunities in Government and the Department to create accessible and inclusive workplaces. We will consider how any new model would work alongside existing schemes.
All our plans are based on strong evidence of how support can make a real difference to individuals and have enough of an employment impact to provide a healthy return on the investment. Crucially, there is now strong evidence about the types of support that are effective in improving employment outcomes – Work Choice, which provided intensive employment support to disabled people, had a significant and enduring impact with participants 40% more likely to still be in work after eight years had passed. More detail will be announced in due course.
Asked by: Lord Taylor of Warwick (Non-affiliated - Life peer)
Question to the Department for Work and Pensions:
To ask His Majesty's Government what assessment they have made of the use of artificial intelligence technologies to help people back into the workforce through (1) monitoring individuals affected by illness; and (2) matching job vacancies with job seekers.
Answered by Baroness Sherlock - Minister of State (Department for Work and Pensions)
1) The Health Transformation Programme is exploring how technology can improve the Personal Independence Payment service and support better outcomes for people with Health Conditions and Disabilities.
By creating modern digital health and disability benefit services, the Programme will collect health data in a structured way. This will allow us to use data more effectively to tailor support to individual needs and to connect individuals to the right work, health and skills support for them.
Structured data will also enable the Department to harness emerging technologies, such as AI. We will evaluate the impact of the changes on customers and DWP, before using AI tools widely.
2) We are working on the design for the national jobs and careers service with a pathfinder being planned. As part of the design of the service, we will explore and test the most appropriate use of technology (including AI) to support job seekers with their work search.
Asked by: Lord Taylor of Warwick (Non-affiliated - Life peer)
Question to the Department for Work and Pensions:
To ask His Majesty's Government what assessment they have made of the potential for use of artificial intelligence in writing CVs and cover letters to boost employment levels.
Answered by Baroness Sherlock - Minister of State (Department for Work and Pensions)
AI has the potential to make a significant difference to the support that the Department can offer. However, it is important to use AI tools in the right way. We are working on the design for the national jobs and careers service with a pathfinder being planned. As part of the design of the service, we will explore and test the most appropriate use of technology (including AI) to support job seekers with their work search.
Asked by: Lord Taylor of Warwick (Non-affiliated - Life peer)
Question to the Department for Work and Pensions:
To ask His Majesty's Government what steps they are taking to review the welfare system regarding (1) the increasing number of people claiming benefits and (2) the growing costs of the benefits.
Answered by Baroness Sherlock - Minister of State (Department for Work and Pensions)
The Get Britain Working White Paper focuses on building a thriving labour market, reducing economic inactivity, and increasing the number of people in work. It includes reforms to employment support, skills, and health to get more people into work and help them progress in their career. A link to the White Paper can be found here.
We are committed to reforming the system of health and disability benefits so that it promotes and enables employment among as many people as possible. The system must also work to reduce poverty for disabled people and those with health conditions and support disabled people to live independently. It is also vital to ensure that the system is financially sustainable in the long term.
We are working to develop proposals for reform and will set them out in a Green Paper in spring.