Artificial intelligence (AI) could displace between 1 million and 3 million private sector jobs in the UK, but the overall rise in unemployment is expected to be in the low hundreds of thousands, the Tony Blair Institute (TBI) said in a report published on The Guardian.

The report highlights that, although AI will lead to job displacement in the coming decades, it will also create new roles, mitigating the long-term impact on unemployment.

At its peak, between 60,000 and 275,000 jobs could be lost annually due to AI, with the highest disruption occurring over the next couple of decades. However, the report predicts that by the end of the next decade, job losses will stabilize, with unemployment potentially rising by 180,000 by 2030. This is a relatively modest figure compared to the 450,000 job losses seen annually over the past decade.

TBI emphasizes that AI’s impact will be mixed. While it will replace jobs in sectors such as administration, customer service, and finance, it will also drive economic growth by boosting productivity. The technology’s ability to increase GDP by up to 6% by 2035 could lead to new job creation in areas that are not yet fully realized.

The report suggests AI’s transformative effects on the labour market will require the UK to upgrade its workforce infrastructure, including developing early warning systems for workers whose jobs may be at risk.

Although administrative and secretarial roles are most exposed to automation, sectors like construction, which involve complex manual work, are likely to be less affected. The full impact will depend on future AI developments and government policies.