AI: Labour Market Changes

Lord Leong Excerpts

Wednesday 25th February 2026 Lords Chamber

[Lord Pitkeathley of Camden Town]

To ask His Majesty’s Government what plans they have to expedite the AI Security Institute’s research into threats to economic stability arising from changes in the labour market.

[Lord in Waiting/Government Whip (Lord Leong) (Lab)]

My Lords, the Government recognise that, while AI creates immense opportunities, it also transforms the workplace. To ensure continued access to meaningful employment, we are planning for all possible outcomes. We have launched the AI and the Future of Work Unit, a cross-governmental initiative supported by the AI Security Institute. This unit monitors labour market impacts in real time, accelerating vital research to anticipate disruption and protect the UK workforce.

[Lord Pitkeathley of Camden Town (Lab)]

I thank my noble friend the Minister for his reply and welcome the industrial strategy, as well as the launch of the AI and the Future of Work Unit. My concern is that we do not appear to have tested a scenario in which AI-driven displacement materially outpaces job creation. With estimates of net employment losses of around 8%, and AI capability in some domains doubling roughly every eight months, might it now be prudent to stress-test our underlying assumptions to ensure that they remain robust?

[Lord Leong (Lab)]

My Lords, my noble friend is right to bring up these concerns. Like all technologies, AI will reshape our world of work. We must accept that. We must embrace the new roles and opportunities that the transition brings. This is why we are committed to equipping 10 million workers with essential skills to develop and adopt AI. Furthermore, our Future of Work Unit will provide robust evidence to co-ordinate a proactive national response to these rapidly advancing capabilities, ensuring that no worker is left behind.

[Lord Clement-Jones (LD)]

My Lords, the AI Security Institute was established primarily with a focus on frontier AI safety risks. Does the institute have the expertise and the dedicated resource to assess these systemic AI risks? What consultation is it carrying out with unions, business and trade bodies? Is it actively building on the substantial international work of the OECD, IMF and ILO on labour market risks?

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[Lord Leong (Lab)]

The noble Lord knows that we work globally with our international partners, as I said when I responded to his question a few weeks ago. The Future of Work Unit serves as a government centre of expertise on how AI is changing jobs and work. The unit works with businesses, academics and social philosophers to understand how this technology will impact the workplace and also how it will impact socially. The AI Security Institute is well placed to work with this unit.

[Lord Ranger of Northwood (Con)]

My Lords, the Government recently attended the India AI summit, with its focus on international collaboration. We know that AI works across geographies and that the impact on the labour force will be across geographies. What discussions were had around how the new Future of Work Unit and the institute will work with India or other geographies in looking at labour market disruption?

[Lord Leong (Lab)]

My Lords, the recent India AI summit concluded with the adoption of the New Delhi declaration on AI impact, endorsed by nearly 90 countries. The declaration promotes international co-operation on its benefits, including equitable, enhanced trustworthiness and security, and on expanding access to AI for social and economic growth. We are also signing a leader statement in support of India’s agenda this year. So we are working with India and acknowledging that we have to come together globally to address this issue.

[The Lord Bishop of Oxford]

My Lords, I welcome the new institute, the announcement and the individuals involved. I want to ask a question about the values that the Government will take forward in thinking about this area. What practical steps are they taking to ensure that humanity is at the centre of people’s experience of work, that we are not working for algorithms, and that work is at the centre of humanity and society?

[Lord Leong (Lab)]

My Lords, that is an excellent question. Let me set out the Government’s position here. Let me also say that technology has impacted us for the last 50 years and we have risen above it. We have embraced technology in the way that we work, do business, access financial information and so on. Technology will always be here and there will be challenges, but we have to rise above them. All of us know that we have this telephone in our pockets or our handbags, and the phone is more powerful than the computer that sent men to the moon. We have the power to reach the stars and we have to do it; we have to embrace AI in all our future considerations and ensure that it is safe for everybody.

[Baroness Jones of Whitchurch (Lab)]

My Lords, the launch of the AI and the Future of Work Unit is of course very welcome, but how will it account for the varied AI growth opportunities around the country, which might be very different from place to place? It is important that we ensure that everyone can be supported into better, tailored jobs, and they need to be relevant to their local economy. We do not want a plan that is one size fits all when it needs to be varied around the regions.

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[Lord Leong (Lab)]

I thank my noble friend for all the work she did when she was a Minister at DSIT, especially in this whole area of AI. The AI and the Future of Work Unit is designed to ensure that AI adoption strengthens rather than fragments local economies. Working with mayoral combined authorities, local enterprise partnerships and skills providers, the unit will tailor programmes to regional strengths, whether in advanced manufacturing, financial services, life sciences or the creative industries. By aligning AI skills, business support and innovation funding with local growth strategies, we will unlock productivity gains and high-quality employment across every nation and region of the country.

[Viscount Camrose (Con)]

My Lords, the misguided use of AI in the recruiting marketplace is deeply and unnecessarily disruptive. Mass automation of largely synthetic job applications means that there are far too many applications for most jobs, often by tens of thousands. These applications are, in turn, assessed often only by AI agents, with the result that the marketplace for jobs has become slow, inefficient and ineffective. Does the Minister agree that fixing the recruiting marketplace may be the quickest way to increase employment prospects and productivity for everyone, and can he outline what steps the Government plan to take to do so?

[Lord Leong (Lab)]

My Lords, first, I pay tribute to the noble Lord for his long-standing work in this field and for the consistent attention that he has brought to this very important matter.

We have published the Responsible AI in Recruitment guidance, which sets out good practice for procuring and deploying AI systems for HR and recruitment. This guidance highlights the mechanism that can be used to ensure the safe and trustworthy use of AI in recruitment. As highlighted in the AI Opportunities Action Plan: One Year On, where we have achieved some 38 out of 50 commitments that we set ourselves, we have taken steps to build the AI assurance ecosystem that underpins safe and responsible use of AI. I will reach out to the noble Lord and meet up with him, together with my officials, to explore this further.

[Lord Hunt of Kings Heath (Lab)]

My Lords, my noble friend’s response to this last question was important and welcome. But can I refer him to the remarks of Dex Hunter-Torricke, the former Google executive, from a few days ago? He talked about the devastating impact that AI is now having on young people in terms of recruitment and said:

“The displacement has already begun. Entry-level roles in law, consulting, and software engineering are contracting. Graduates face a labor market narrowing faster than new roles are opening. Workers in middle-income jobs are training their AI replacements right now”.


I urge the Government to think carefully about what impact this is now having on young people in this country and what we are going to do about it, and what we are going to do with employers. This is urgent.

[Lord Leong (Lab)]

My noble friend is right. We will not stand by but will look proactively at the evidence of impacts on the workforce. Yes, we acknowledge that some work will be replaced by AI, but, at the same time, new jobs will be created and we have to ensure that our workforce right across the country adopts new AI skills. That is why the Government are going to upskill 10 million people right across all sectors to ensure that they have the basic skills to incorporate and use AI to improve their productivity and so on. At the same time, we are also looking at the curriculum: AI will be taught in schools, so that, when children finish school, they will be better equipped for the new work environment.