I've been running Reed almost 35 years. In that time, we've weathered the 2008 financial crash and the early, frightening days of the pandemic. Both were brutal. But something about this moment worries me more than either of those, because back then there was a shared sense that we needed to sort things out. Right now, as a society, we're behaving like rabbits caught in the headlights, watching enormous change roll towards us and doing very little about it.
So let me be plain about where I stand. My mantra is simple: back humans, tax robots.
A tax on jobs at the worst possible time
Let's start with the October 2024 Budget. The £25 billion increase to employers' national insurance was, in my view, a historic mistake. Call it what it was, a tax on jobs.
I saw the effect almost immediately. Within a week, clients were cancelling hiring plans. The numbers tell the story too, vacancies across the country have fallen from over a million to around 700,000, fewer than before the pandemic.
The timing couldn't have been worse. When you make people more expensive to employ, businesses start looking at the alternatives. Automation is one. Offshoring is another. So, when the cost of employing people here goes up, that conversation comes straight back onto the table.
We've effectively nudged employers towards machines and overseas hiring at the exact moment technology has made both easier than ever.
AI is cutting through entry-level jobs
The second force at play is artificial intelligence, and it's moving fast. AI is burning through entry-level jobs, the very roles that give young people their first foot on the ladder.
The graduate market shows this most starkly. Graduate vacancies on Reed.co.uk have collapsed from 180,000 to 50,000 in four years, and they're still falling. The hardest-hit group is 21 to 25-year-olds, many of whom left university with degrees that, frankly, have little currency in the world of work right now.
Think about what that means. These young people did everything they were told to do. They got the qualifications. And they're arriving at a market that has fewer and fewer places for them. That should trouble all of us, not just as employers but as parents and citizens.
Why we should tax robots, not workers
Here's the thing about taxation: it follows wealth. Look at the history of it. When you see technology companies valued at over a trillion, that's where the action is. So that's where the taxation should follow.
At the moment, we're taxing employers who hire young people to pick up beer glasses in pub gardens, and we're not taxing the robots. The chatbots and AI systems replacing human work consume huge amounts of energy and contribute significantly to climate change, yet they go entirely untaxed. Taxing work and workers feels very early 20th century to me.
I'm not pretending this is simple. It would take some careful designing. But the principle is sound. It might be a surcharge if you replace people in your business with machines. It might be a transaction-based levy on AI services, rather like VAT. The mechanism is up for debate. The direction of travel shouldn't be.
Critics say a robot tax would slow innovation. I understand the concern, but studies suggest that fear is overstated. What such a tax would do is make sure the tax system stays fair and keeps funding public services, even as automation takes over more work.
We've been ridiculously snobby about trades
If we want young people to thrive, we also need to rethink education. For too long, as a society, we've been ridiculously snobby about trades, when those are often the jobs of the future.
The idea that half of our young people should go to university is very outdated and many graduates feel mis-sold. Meanwhile, apprentices in their early twenties are often way ahead of their university-educated peers, earning while they learn and building skills that employers actually need.
I'd like to see a three-lane superhighway for school leavers. A third go to university. A third do apprenticeships. And a third go straight into work, with a short-term subsidy to help employers take them on. That gives every young person a genuine, respected route forward.
What this means for your organisation
So, what should you do about all this? Don't wait for government to catch up. Start preparing now.
Look hard at where you're investing in people versus machines, and be honest about the long-term cost of hollowing out your entry-level roles. If you stop hiring and training young people, you lose your future pipeline of talent and leaders.
Build apprenticeship and early careers routes into your workforce planning. Bringing on graduates and apprentices isn't charity, it's smart business. These are the people who'll grow with you, understand your culture, and become the specialists you'll rely on in five years' time.
The organisations that back humans now, alongside the technology, will be the ones still standing when the dust settles.
Back humans, tax robots. It really is that simple.
I’m interested in hearing your thoughts on this topic. Leave your comments and thoughts on my LinkedIn post.
