Old skills, new skills: what is changing in the UK labour market?
Creators: name: Costa, Rui
name: Liu, Zhaolu
name: Pissarides, Christopher
name: Rohenkohl, Bertha
Publisher: name: Zenodo
Year: 2024
Subjects: skills
ai
labour market
uk

description: The UK, along with other industrial countries, has recently undergone rapid technological change associated with robotics and artificial intelligence, jointly known as automation technologies. This is precipitating significant transformations in terms of how work is organised, what tasks are performed and what skills are essential for success. Quantifying the scale and nature of these changes to skills requirements is important as we aim to better understand the impacts of automation technologies on the UK labour market. Without the right mix of skills, economies cannot respond and adapt, nor take advantage of new advances in technology that will help to improve productivity. This is why research into skills is a central part of the Pissarides Review into the Future of Work and Wellbeing.

In this report, we use a comprehensive dataset of online job postings from Adzuna, which provides information on the type of positions advertised and the skills that they require. We focus on the evolution of skill requirements from 2016 to 2022. The period, selected based on the availability of data, offers a valuable perspective on the recent shifts happening in the UK labour market. These changes are reflected in the rapid emergence of new skills and the disappearance of other, old skills. Notably, most skills becoming obsolete and new ones emerging to take their place, are related to IT. For example, while in 2016 it was common to see job postings requiring basic computer literacy, like web navigation, in 2022 we find an increased demand for new IT skills such as cybersecurity, the ability to work with AI and cloud solutions.

We quantify the magnitude and pace of skill change and find that it varies considerably across occupations. Occupations like IT directors, production engineers and cybersecurity professionals have experienced a high turnover of skill requirements over our six-year period. This contrasts with slower-changing occupations, such as teaching, carpentry and several elementary trades. 

Our analysis spans multiple dimensions, such as the type of skills required, their concentration across occupations, and whether they are specialised or general. We place particular emphasis on the growing importance of technology-related skills. In 2022, a large share of job vacancies, across several occupational groups, require competencies in IT and advanced data analytics, and we delve deeper into the specific types of tech skills undergoing the biggest changes. This reflects the ongoing integration of new technologies in work and highlights the need for continuous skill development in this constantly evolving market.

Of course, although technology skills are for understandable reasons the ones that are attracting a great deal of attention in public discourse, there is no escaping the fact that, once the data is dissected, by far the most popular skills remain the ever sought-after ones: clear communication, high-quality client services, efficient office management and effective customer relations. This reflects the structure of British business, and it points to the fact that - despite the automation hype - when it comes to direct contact with customers or colleagues, the ability to effectively manage relations at the personal level is still a skill that the majority of companies request.