Rishi Sunak has suggested that the government should consider scrapping national insurance contributions to help young people whose jobs are being affected by artificial intelligence. The former prime minister, who now advises AI firms Anthropic and Microsoft, warned that concerns from graduates seeking entry-level jobs are justified, despite his enthusiasm for the technology.
Speaking to BBC Newsnight, Mr Sunak said business leaders are privately acknowledging that recruitment of young people is flattening due to rapid AI advancements. He proposed gradually abolishing national insurance and replacing it with taxes on corporate profits, which he argued would be boosted by productivity gains from AI deployment.
“When you employ a person, you end up having to pay a significant incremental cost in national insurance contributions and other employment costs,” Mr Sunak explained. “If that same business is thinking about taking on an AI agent, it doesn’t have to bear any of those costs. So that seems like an obvious area we should look at.”
Mr Sunak noted that young people are finding it increasingly difficult to secure jobs in service sectors such as law, accountancy, and creative industries. He said many chief executives are adopting a “flat is the new up” approach, growing businesses without significantly increasing employment by deploying AI.
The former PM also emphasised the importance of AI literacy, calling it “the equivalent of the driving licence for the modern workforce.” He warned that workers are “more likely to lose your job to someone who is using AI than to AI itself,” and urged people to gain confidence in using AI tools.
Mr Sunak highlighted the UK’s potential as an “AI superpower” and revealed he has joined forces with Labour’s David Lammy to promote investment in the UK tech sector. He set up an AI safety summit in 2023 and continues to advocate for a balanced approach to AI adoption.
