Upskilling the UK AI Workforce in the age of AI

Workforce Readiness – Mind the Gap

As AI technologies continue to integrate into decision-making processes and workflows, businesses face a critical new territory: learning how to upskill their workforce. As of February 2, 2025, the AI literacy requirements under Article 4 of the EU AI Act have been applicable, meaning businesses need to ensure they have set up measures for effective AI literacy.

Artificial Intelligence is fundamentally reshaping how organisations operate, creating unprecedented opportunities while introducing complex challenges that demand immediate attention. The World Economic Forum’s Future Jobs report, predicts that 40% of employers anticipate workforce reductions by 2030 as AI automates routine tasks. At the same time, the Tony Blair Institute for Global Change reports that 38% of people cite lack of trust in AI as a barrier to adoption. This paradox -- automation pressures on one side and trust deficits on the other-- underscores the urgency of preparing the workforce.

The skills base support for AI integration remains fragile. Nearly half (49%) of employees have not had the opportunity to learn about using AI at work. But it’s not just AI -- 10 million UK workers still lack essential digital skills, and 7.3 million (18%) lack the essential digital skills needed for the workplace. The lack of digital inclusion investments in AI upskilling risk leaving large parts of the workforce behind.

The stakes are significant for UK employers.

The UK government has recognised this urgency through measures such as the AI Opportunities Action Plan and the Department for Science, Innovation and Technology’s (DSIT) AI Upskilling Fund pilot.

Yet significant barriers remain. The 2024 Lloyds Bank Consumer Digital Index highlights that 1.6 million people in the UK are still offline, while 23% struggle with online services. In a cost-of-living crisis, digital exclusion risks widening inequalities just as AI becomes more embedded in daily life and work.
For the UK to establish genuine leadership in safe and ethical AI deployment, organizations must make significant progress in developing their employees’ AI capabilities.

Why SMEs hold the key

Small and medium enterprises (SMEs) employ 60% of the UK workforce, making them crucial to Britain's AI transformation. While over a third of SMEs now actively use AI technology - up from 25% in 2024 - many still face barriers to investing in AI literacy and training. This represents both a vulnerability and an opportunity for the UK economy.

Across the UK, employees are engaging with AI tools daily, often without proper guidance on their inherent limitations, potential biases, or associated risks. The question is not whether organisational workforces are utilising AI systems, but rather the extent to which this utilisation demonstrates competency and strategic alignment.

The regulatory reality check

The European AI Act mandates AI literacy for all employees developing or deploying AI systems. This doesn’t just apply to businesses in the EU - UK businesses who provide or deploy AI systems in the EU will, under the EU AI Act, need to make sure their staff have a sufficient level of AI literacy and equip them with the knowledge and skills to understand, use and interact with AI responsibly and effectively.

The financial stakes are considerable: penalties reach €35 million or 7% of global turnover, whichever is higher. But beyond compliance costs, there's a competitive dimension. UK businesses that proactively build AI literacy capabilities will be better positioned to navigate not just EU requirements, but any future UK AI regulation that may emerge.

Under Article 4, the AI literacy requirements are surprisingly broad; they apply to all businesses in scope, whether developing or deploying systems, regardless of the AI system's risk level. While the Act doesn't prescribe specific training methods, it emphasises best practices through its living AI repository, giving businesses flexibility in how they meet compliance obligations.

Building an AI Literacy strategy

•Understand your AI usage - Start by auditing existing AI tools and applications across your organization. Evaluate risks, impacts, and your risk appetite for AI deployment. Organisations should evaluate AI risk and potential impacts, including critically evaluating their risk-appetite.
•Define your AI literacy goals and roles - AI literacy isn't one-size-fits-all. C-suite executives need strategic understanding of governance requirements. Marketing professionals need effective prompting skills. Developers require deep knowledge of bias detection and regulatory frameworks.
•Take a socio-technical approach - The most successful programs combine technical understanding with social impact awareness. Employees need to understand both how AI systems work and their broader implications for business and society.
•Implement continuous monitoring - Regular self-assessments and knowledge checks ensure your program remains effective and compliant as AI technologies evolve.

The Early adopter advantage

With AI’s accelerating evolution and widespread accessibility, organisations must address both fear and uncertainty while empowering employees to leverage AI responsibly within their roles, processes and business strategies.

Organisations investing in comprehensive AI literacy programs are already seeing measurable ROI through improved operational efficiency and reduced compliance risks. The next wave of competitive advantage won't come from AI tools themselves, but from workforces that can leverage them effectively while understanding ethical implications.

The question isn't whether the UK workforce will need AI literacy, it's whether we'll build that capability proactively, positioning Britain as the global standard for responsible AI deployment, or reactively, playing catch-up with faster-moving competitors.

The winners of AI won't be those building the most powerful tools, but those using them most wisely, creatively, and responsibly across all sectors and use cases.
Building an effective AI literacy program requires a holistic approach and should be a tailored approach to varying roles and stakeholders. That’s why Holistic AI developed its AI literacy program with leading law firm Lewis Silkin to combine deep expertise in AI governance and law for a sociotechnical approach to AI literacy. Just knowing the social or technical side isn’t enough – the workforce needs holistic AI literacy.

Author

Ayesha Gulley

Policy Product Manager - AI Governance, Holistic AI

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