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How is digital change transforming the workforce?
Our survey, asked senior decision makers across a range of sectors how digital transformation was reshaping the modern workforce. Their answers might surprise you. While news headlines indicate major change is underway, the results did not reflect the same.
63% of respondents believe digital enablement will affect employment within the next five years, and 31% expect roles to be transformed. Yet the pace of change on the ground is proving somewhat slower, with a significant 39% saying the impact so far has been minimal.
This gap between expectation and experience reflects the practical challenges organisations face when implementing digital transformation. Two barriers standout: digital skills shortages (27%) and resistance to change (24%) particularly in larger organisations and sectors like professional services, where internal resistance rises to around 35%.
Despite this, 68% of respondents have investment plans for digital infrastructure over the next two years. The message is clear: employers must upskill their workforce, communicate changes effectively, engage with workers and stay compliant with UK law.
Across all sectors, change is being driven by the rapid adoption of automation, AI and data driven decision making. Many organisations remain early in their digitalisation journey, which may explain why the workforce impact has been uneven.
For example, internal resistance to digital transformation is notably high in professional services, at around 35%. Meanwhile, in larger organisations, long standing practices, complex structures and cautious governance often make it harder for teams to embrace new technologies quickly.
Culture is emerging as a highly influential factor determining the success of workforce transformation. The challenge for large organisations is winning over employees who have reservations about being ‘replaced’ by technology. Even with the right tools, progress stalls when organisations fail to communicate the purpose behind digital change or bring their teams with them.
Against this backdrop, UK employers must also manage the legal implications of tech-driven change, ensuring compliance with data protection, equality obligations and other employment laws. With the Employment Rights Act 2025 meaning employees will gain unfair dismissal rights sooner, mitigating this risk will be important.
Despite widespread expectation of disruption, 39% of respondents say digital enablement has had minimal impact on roles to date. This doesn’t necessarily reflect a lack of ambition rather highlights the practical constraints many organisations currently face.
Although early impact has been limited, change is coming fast. AI adoption, automation of routine tasks and digital service models will drive significant workforce change across sectors in the coming years.
These technologies will reshape job roles and redefine the skills organisations must prioritise – digital literacy, data analysis and technology enabled client service among them.
Survey respondents identified skills shortage (27%) the most significant barrier to digital enablement. It affects organisations of all sizes but is particularly acute in sectors undergoing rapid technological change. With technology advancing at an exponential rate, the labour market simply cannot keep pace. Larger enterprises face additional delays due to legacy systems and complex governance.
Coupled with the existing shortage in digital skills, employers may rightly be concerned about the potential loss of existing skills by introducing new technologies such as AI and automation. Routine tasks that form the building blocks of development at a junior level may now be done in a fraction of the time with the help of new technology.
But where does this leave employers who need to train future leaders? The answer: identify which critical skills risk being lost to automation and other tools and take steps to protect them.
Retraining and upskilling existing staff, as well as future-proofing workforce planning, will be essential to any digital enablement strategies.
Reluctance to embrace new technology also remains a central challenge. Overall, 24% of survey respondents cite internal resistance, rising to 35% in professional services and 37% in large organisations. Change can set hares running at the best of times, and digital transformation represents one of the biggest shifts to employees’ ways of working. It is perhaps understandable that employees have legitimate concerns around engaging with technology that they consider may replace them.
Employee engagement and consultation will be a vital consideration for employers to ensure staff feel they have a role to play in the journey, rather than being left behind. Engage with employees to identify specific tasks that can be automated.
Employers should demonstrate to their workers how new technologies can help them to focus their time on the more valuable elements of their roles, automated note-taking, for example, lets a salesperson focus on what a customer is saying. The result: more interesting work and a more valuable contribution.
Leadership buy-in is also crucial. Digital programmes stall when leaders lack a consistent view on priorities or hesitate to champion change.
Just as the practicalities of digital transformation must be carefully considered, so too must the legal considerations. Around 36% of survey respondents said that they were not confident or did not know whether their organisation’s digital strategy aligned with regulatory requirements and legal risk management. This should be a warning sign.
Poorly implemented technology or unclear communication can increase the risk of grievances potentially leading to Employment Tribunal claims. With the qualifying period for unfair dismissal claims set to reduce from two years to six months in January 2027, employers must be alive to the risk of more claims. To manage this risk, organisations need a framework that supports transformation while ensuring consistency, fairness and transparency.
Data protection presents another challenge. For almost half of survey respondents, it represented a top compliance concern – one that can arise even before employment begins.
AI-assisted recruitment (CV review, video interview analysis) carries discrimination risk if algorithms aren’t properly calibrated or fail to account for disabilities. Similar caution applies to workplace AI tools. Facial recognition software, for instance, raises both data protection and discrimination concerns. These systems can contain inherent biases.
Such tools may have a place, but combining them with evidence-based decision making is essential to minimise disputes and maintain employee trust. Before rolling out a new technology, employers should conduct thorough data protection impact assessments and consider whether the technology provides the least intrusive way of achieving their aims.
Although the adoption of AI has the potential to bring great efficiencies to the workplace, it may simultaneously have negative consequences for workers. Trade unions are significantly invested in how employers are implementing AI within their workforces. Employers will need to be prepared to engage with union representatives on their use of AI and safeguarding workers’ rights.
Just as the practicalities of digital transformation must be carefully considered, so too must the legal considerations. Around 36% of survey respondents said that they were not confident or did not know whether their organisation’s digital strategy aligned with regulatory requirements and legal risk management. This should be a warning sign.
Poorly implemented technology or unclear communication can increase the risk of grievances potentially leading to Employment Tribunal claims. With the qualifying period for unfair dismissal claims set to reduce from two years to six months in January 2027, employers must be alive to the risk of more claims. To manage this risk, organisations need a framework that supports transformation while ensuring consistency, fairness and transparency.
Data protection presents another challenge. For almost half of survey respondents, it represented a top compliance concern – one that can arise even before employment begins.
AI-assisted recruitment (CV review, video interview analysis) carries discrimination risk if algorithms aren’t properly calibrated or fail to account for disabilities. Similar caution applies to workplace AI tools. Facial recognition software, for instance, raises both data protection and discrimination concerns. These systems can contain inherent biases.
Such tools may have a place, but combining them with evidence-based decision making is essential to minimise disputes and maintain employee trust. Before rolling out a new technology, employers should conduct thorough data protection impact assessments and consider whether the technology provides the least intrusive way of achieving their aims.
Although the adoption of AI has the potential to bring great efficiencies to the workplace, it may simultaneously have negative consequences for workers. Trade unions are significantly invested in how employers are implementing AI within their workforces. Employers will need to be prepared to engage with union representatives on their use of AI and safeguarding workers’ rights.
63% of respondents agreed that the next five years will bring a digital revolution to the workplace, and employers that take the time to prepare, train and equip their workforces will stand in good stead to take full advantage of the opportunities.
To do this effectively, employers should:
Early legal advice can help organisations navigate practical challenges, mitigate risk, and ensure compliance with UK employment law throughout their transformation programmes.
“Digital transformation is not just a technological shift – it's a people shift. Organisations that plan their workforce, engage their employees and align with their legal obligations will be best placed to seize the opportunities ahead.”
Luke Bowery Partner, Burges Salmon
