Artificial Intelligence (AI) exposed sectors see a fivefold increase in the rate of productivity growth, with UK employers willing to pay 14% wage premium for jobs that require AI skills

• In the UK, job postings which require AI skills are growing 3.6 times faster relative to all job postings 
• On average, UK employers are willing to pay a 14% wage premium for jobs which require AI skills, with the legal and information technology sectors experiencing the highest premiums
• The sectors more exposed to AI experience 4.8 times greater labour productivity growth relative to those that are less exposed
  

Sectors more exposed to AI (meaning that AI can readily be used for some tasks) are seeing an almost fivefold increase in the rate of productivity growth globally, according to PwC’s inaugural 2024 Global AI Jobs Barometer, painting a positive picture of the impact of AI on global labour markets. 

The report, which analysed half a billion job adverts from 15 countries and explores AI’s impact on jobs, skills and wages, indicates the potential productivity gains for the UK through AI adoption. In the UK, the uptick in productivity in the sectors which are more exposed to AI (such as financial services, information technology, and professional services) is marginally above the global average. With long-term productivity issues a hindrance to UK economic growth, AI could therefore help to bridge the gap with other nations, leading to increased prosperity and better living standards.

Rapid growth in jobs requiring AI skills

Between 2012 and 2023, postings for jobs which require AI skills (those requiring technical skills such as machine learning) in the UK have grown 3.6 times faster than for all jobs, which is slightly more than the global average, where growth in jobs demanding AI skills has outpaced all jobs since 2016. While in 2012 three in one thousand job posts in the UK required AI skills, this jumps to nine in one thousand jobs just over ten years later. By comparison, in Singapore jobs that require AI skills have grown 13.5 times faster than all jobs. 

While there has been rapid growth in jobs requiring AI skills, the report indicates that in sectors most exposed to AI demand for other skills could lessen. Although jobs in AI-exposed sectors are still growing, job openings in sectors less exposed to AI are growing 46% faster. The analysis highlights the need for workers to adapt and build new skills for the fast-evolving jobs market. Indeed, 64% of UK CEOs said that AI will require most of their workforce to develop new skills in the next three years, according to PwC’s 2024 CEO Survey. 

Barret Kupelian, Chief Economist, PwC UK, said:

“Our findings show that AI has the power to create new industries, transform the jobs market and potentially push up productivity growth rates. In terms of the economic impact, we are only seeing the tip of the iceberg - currently our findings suggest that the adoption of AI is concentrated in a few sectors of the economy, but once the technology improves and diffuses across other sectors of the economy, the future potential could be transformative.

“Historically big leaps in technology presage changes in the labour market. We are already seeing this happen. Our analysis suggests that the menu of skills required by employers in occupations exposed to AI is changing about 25% faster than those which aren’t. As pickup of AI continues, this trend is likely to intensify, creating new roles whilst also reducing demand for some skills that can be done more efficiently using AI.

“With the technology growing rapidly, and 42% of UK CEOs* saying they have adopted AI across their companies in the last year, it’s key that current and future workers are upskilled for the AI era to ensure that technology is used responsibly and that the benefits are spread equitably. Both business and government have a key role to play in coordinating, shaping and delivering the skills agenda.”

Employers willing to pay more for AI skills

As well as an increase in productivity, the report highlights the economic opportunity for workers. Jobs that require AI specialist skills carry a 14% average wage premium in the UK, with job adverts for lawyers with AI skills seeing a 27% wage premium, and database designers and administrators experiencing a 58% premium. Of the five countries analysed, the largest average wage premium is 25% in the US, followed by 14% in the UK, 11% in Canada, 7% in Singapore and 6% in Australia.

Mehdi Sahneh, Senior Economist, PwC UK, said:

“Countries and sectors that have a high demand for AI skills tend to see higher wage premiums, especially if there is a scarcity of skilled professionals, whereas in areas where there is a more abundant supply of AI talent, lower premiums are more likely. Although on the surface lower wage premiums may sound less favourable, all else being equal, they suggest a balance between labour supply and demand, and could potentially foster greater AI adoption and innovation over the long term. 

“It’s also positive news that increased use of AI could turn the dial on productivity in the UK. Since the financial crisis, UK productivity has trailed that of all of the G7 nations, bar Japan, growing only 2.2% on average between 2008 and 2021. With the gap widening in recent years, AI could be the missing piece of the UK’s productivity puzzle, bringing a boost to the economy, wages, and living standards.”

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