Rishi Sunak warns AI is making it harder for young people to land jobs in law, finance

Artificial intelligence is already impacting employment opportunities for young people, particularly those entering professional sectors, former UK prime minister Rishi Sunak has said.

In an interview with the BBC, Sunak noted that companies are beginning to rely more heavily on AI tools, reducing the need to hire entry-level employees.

While he described himself as optimistic about the long-term potential of AI, he acknowledged that concerns among graduates struggling to find their first jobs are “justified”.

According to Sunak, senior executives have privately indicated that recruitment levels for younger workers are flattening due to the increasing adoption of AI technologies.

‘Flat is the new up’: CEOs rethink hiring

Sunak said business leaders are embracing a new approach to growth, where companies expand output without proportionately increasing their workforce.

“They think they can continue to grow their businesses without having to significantly increase employment,” he said, describing how AI is enabling firms to boost productivity with fewer hires.

This shift is particularly visible in sectors such as law, accountancy and the creative industries, where traditionally large numbers of junior roles have served as entry points for young professionals.

Call to overhaul tax system

To counterbalance this trend, Sunak suggested governments should consider long-term changes to taxation policies. He proposed gradually eliminating National Insurance contributions and replacing them with taxes on corporate profits.

He argued that as AI increases productivity and efficiency, companies’ profits are likely to grow — offering an alternative revenue base for governments.

Such a move, he said, could incentivise businesses to hire more workers by lowering the cost of employment.

Rethinking AI’s role in the workplace

Sunak stressed that policymakers must ensure AI is used to enhance jobs rather than replace them. He said governments need to “tip the balance” so that AI tools support workers and improve productivity, instead of reducing employment opportunities.

He also warned that AI’s impact on jobs could differ from previous waves of technological disruption, requiring fresh policy responses rather than relying on historical patterns.

Countries may also face declining tax revenues from employment as automation increases, making it necessary to explore new fiscal strategies.

Concerns around AI safety and regulation

Sunak, who currently advises AI firm Anthropic and Microsoft, also addressed concerns around emerging AI capabilities.

Earlier this month, Anthropic introduced a new AI model, Claude Mythos, which the company said can outperform humans in certain cyber-security and hacking-related tasks.

The development has prompted discussions among regulators and financial institutions about potential risks to digital systems.

Sunak cautioned against allowing companies to self-regulate, stating that independent oversight is necessary. He highlighted that the UK’s AI Security Institute — set up during his tenure — was the first to test the system’s capabilities.

UK’s ambition to lead in AI

Despite the concerns, Sunak expressed confidence in the UK’s position in the global AI landscape. He pointed to the presence of major firms such as Google DeepMind, Anthropic and OpenAI as evidence of the country’s growing influence.

He also revealed that he recently collaborated with Labour leader David Lammy to promote investment in the UK tech sector at an AI summit.

Sunak said the UK has the potential not only to develop advanced AI systems but also to become one of the most productive users of the technology globally.

While the technology promises efficiency and economic growth, it also raises questions about job creation, skills adaptation and the future of work.

Governments, he suggested, must act proactively to ensure that AI-driven transformation benefits both businesses and workers.