UK Hiring Declines as Demand for AI Skills Reaches Record High, Indeed Reports

LONDON: Hiring activity in the United Kingdom declined during the first half of 2026, while employer demand for artificial intelligence (AI) skills surged to a record high, reflecting a rapidly evolving labour market, according to a new report by recruitment platform Indeed.

The report found that overall job postings remained under pressure, with graduate vacancies falling to their lowest level since 2020. Slower hiring has been driven by economic uncertainty and rising business costs, making it increasingly difficult for young people and first-time job seekers to enter the workforce.

Despite the broader slowdown, vacancies requiring AI-related expertise have risen sharply to an all-time high, highlighting employers’ growing focus on digital transformation and advanced technology skills. Companies are increasingly seeking experienced professionals capable of developing, deploying, and managing AI-powered systems.

Jack Kennedy, Senior Economist at Indeed, said the UK labour market is becoming increasingly divided, with hiring concentrated in experienced and AI-related roles while opportunities for graduates and entry-level workers continue to shrink. He noted that this trend is creating a “two-speed” jobs market in which technological expertise is becoming a key competitive advantage.

The findings come as the UK government seeks to improve employment prospects for young people through expanded technical education, apprenticeships, and vocational training aimed at equipping workers with skills needed in an AI-driven economy. Analysts say demand for AI capabilities is expected to continue growing even as overall recruitment remains subdued.