Hasan Bakhshi, Josh Siepel and Zihan Wang explore Generative AI and the shift in labour market skill requirements, as revealed in our new Discussion Paper.
The emergence of Artificial Intelligence (AI) over the past two decades promises faster economic growth, but also raises concerns about labour market disruption, prompting intense debate over the future of work. Since the public release of ChatGPT in late 2022, AI has entered a new phase, with large language model-based generative AI (GenAI) tools becoming widely accessible and increasingly embedded into workplace routines. Although still in their early stages of development, these tools already show considerable potential to automate non-routine and creative tasks ranging from ideation to content creation, selection and evaluation, domains previously considered uniquely human.
As with every major technological breakthrough, GenAI brings structural shifts in what employers need from workers. Some skills may decline in value as tasks become automated, while others will rise in prominence as firms adapt to new ways of working. Central questions arise: how is GenAI reshaping the mix of skills employers look for? Do firms value human creativity less, because it is being overshadowed by the growing demand for AI skills? Or do they value it even more, because it cannot be displaced by GenAI tools, but instead can be complemented and enhanced by them?
These questions are especially pertinent in the UK, where the creative industries employ 2.4 million people and contribute £124 billion to the UK economy. Theory however cannot adjudicate, so we need to look at the real-world data for answers.
New evidence: AI skills and creativity are increasingly demanded in tandem
In our new Creative PEC Discussion Paper, we analysed over 168 million UK job postings from 2016 to 2024, drawing on Adzuna vacancy data. Using advanced natural language processing (NLP) techniques, we identified postings that required AI and creativity skills by scanning job descriptions for both explicit and implicit references to the skills demands. We then explored their association across UK labour markets, using ONS Travel-to-Work-Area (TTWA) geographical commuting areas as our labour market unit. Our massive dataset means that we are able to track the skills composition of job advertisements on a month-by-month basis for most occupations in all UK TTWAs. By way of example, the dataset allows us to identify the percentage of job advertisements for programmers and software developers (SOC 2020 code: 2134) in Liverpool requiring AI and/or creativity skills on a month-by-month basis from 2016 to 2024.
We used the public release of ChatGPT at the end of November 2022 as a turning point to examine how the relationship between employer demand for AI and creativity skills has evolved before and after this key event. Our analysis reveals three headline findings:
- AI skills and creativity skills co-occur in job postings: Labour market units (aggregated at the SOC-TTWA level) with higher share of jobs requiring AI skills are also more likely to have a higher share of jobs demanding creativity skills. This positive association has strengthened significantly post-ChatGPT, suggesting that employers increasingly wish to have a workforce that draws on both skill sets.
- Creative clusters lead the way: The strongest association between share of job posting requiring AI skills and posting requiring creativity skills is found in the UK’s 55 creative clusters, where dense networks of creative firms generate demand for both AI and creativity skill profiles.
- A high-skill, high-tech story: The association between employers’ demand for AI skills and creativity skills is especially pronounced in labour markets with a higher share of high‑skilled roles, which require advanced qualifications or senior-level expertise.
Taken together, our analysis suggests there has been a shift in employer skill requirements in UK labour markets in response to the rapid development in GenAI, where AI skills and creativity are increasingly valued in tandem rather than in isolation.
What this means for policy
As GenAI continues to evolve, creativity remains a vital human asset, with demand so far strengthened, not undermined, by technological change. This points to three broad implications for the skills system.
1. Rethinking skills provision
The rising importance of creativity for employers alongside AI means that the UK ignores investment in creative skills at its peril. GenAI makes investing in the workforce’s creativity even more, not less important for the UK’s future competitiveness. The government should place creativity at the heart of its initiatives with industry to grow the AI literacy of the UK workforce.
2. Supporting inclusive AI adoption within firms
Employers looking to invest in the AI skills of their workforce should also look to increase not decrease investment in the creativity skills of employees who are currently in roles at high risk of displacement from GenAI. Likewise, creativity skills providers should embed AI literacy into their training and development offers.
3. Place-based regional intervention
The labour market impacts of GenAI are spatially uneven. Urban areas with strong creative clusters and thick, high-skilled labour markets are leading the way in combining AI skills and creativity. In contrast, rural areas and left-behind places risk falling further behind. In recent years, we have seen major initiatives to grow creative clusters across the UK, such as the Arts and Humanities Research Council’s Creative Industries Clusters Programme. Our research suggests there is a particular need to support the development of local ecosystems where AI skills and creativity can co-evolve too.
Yutong Liu & Kingston School of Art / https://betterimagesofai.org / https://creativecommons.org/licenses/by/4.0/
