CIPD data reveals impact of AI tools on headcount

The CIPD’s quarterly Labour Market Outlook, which has now been published for autumn 2025, highlights the anticipated impact of AI in the workplace on job retention, as hiring confidence remains at a record low outside the pandemic.

The report found that 17% of employers say the use of AI will cause the number of staff within their organisation to decrease in the next 12 months, with a quarter expecting the reduction to be greater than 10%. The roles most likely to be affected are clerical, junior managerial, professional and administrator roles.

The CIPD says that the UK labour market at present remains stable. There has been no change to its net employment balance indicator which remains at +9 (the net employment balance indicator measures the gap between employers expecting staff increases and those anticipating decreases) and the median basic pay increase has stayed at 3% for the sixth consecutive quarter.

In the public sector, employment intentions remain below zero and have fallen to −8 this quarter. This means more public sector employers expect staff numbers to decrease rather than increase over the next three months.

Key recommendations for employers include:

taking a strategic approach to workforce planning, ie using skills audits and internal redeployment to maintain capability
refreshing attraction strategies as hiring pressures ease, focusing on job quality, inclusion and realistic role design
making fair, transparent pay decisions and considering a financial wellbeing strategy to help those with money concerns
using AI responsibly to support, not replace, people, focusing on enabling a fair transition to new and evolving roles
re-skilling for an AI-driven workforce and identifying the roles most affected by automation and investing in training and redeployment.

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CIPD data reveals impact of AI tools on headcount

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