Navigating Australia’s AI-driven labour market

A number of Australian employers have announced redundancies or restructures, linked to automation and AI adoption.

The structural impacts of AI on the labour market are starting to be seen and are expected to become more noticeable over the next few years, according to the June 2026 edition of Deloitte Access Economics’ quarterly Employment Forecasts report.

Deloitte Access Economics assessed occupations based on the extent to which an occupation’s core tasks can be automated by AI versus the necessity for human performance.

According to the firm’s analysis, 82 “AI-disrupted” occupations are expected to face the highest risk of declining employment, as AI replaces tasks that require less human judgement, empathy, or interpersonal skills.

Job vacancies in some of these disrupted occupations have started to fall as AI begins to reshape Australia’s labour market. However, employment levels in these occupations have continued to rise to date, suggesting the effects are being felt more in recruitment than in redundancies.

David Rumbens, Deloitte Access Economics partner, indicated that the lack of proof in job losses potentially indicates that the primary role of AI is skewed.

“Limited evidence of widespread job losses could suggest that AI is currently playing more of an augmentative role in the Australian labour market, with Australians less likely to use AI primarily for automation,” Rumbens said.

As such, he noted that these patterns leaning towards augmentation utilisation may enhance efficiency.

“These augmentation-focused usage patterns suggest AI could deliver much-needed productivity gains while job gains are still seen,” he said.

“This may also simply reflect the current stage of adoption, with AI tools still used mainly to boost individual productivity before a later phase of more significant change as work processes are reorganised.”

The report displayed that AI disruptions are expected to be saturated among industries that tend to employ white-collar occupations, which typically include financial and insurance services, scientific and technical services, and information media.

Meanwhile, in the short term, blue-collar employment faces slower and more selective disruption.

Physical labour in unstructured environments, such as construction, remains a challenge for AI and robotics.

However, automation trends in more structured environments, such as factory floors, may be accelerated by AI over time.

Many community and personal service occupations, as well as customer-facing sales occupations, rely on human interaction, judgement, and collaboration, meaning AI implementation within these industries is seemingly difficult at the moment.

As AI begins to reshape the Australian labour market, employers are experiencing a significant shift from immediate job losses to more nuanced changes in recruitment and workforce strategy.

Deloitte Consulting partner Sarah Rogers said: “Executives should not be complacent in their existing business models, work design and workforce strategies, and workers should seek to upskill and retrain in AI.”

“Research showed that organisations are twice as likely to exceed their return on investment expectations for AI when they prioritise work redesign and thoughtfully redesign human and machine interactions.”

The emerging impact of AI on work comes during a rather tumultuous time in the workforce, whereby the labour market is softening amid higher interest rates and major economic implications resulting from the Middle East conflict.

The report highlighted that 2026 saw an acceleration of job losses blamed on AI.

Annual employment growth in the year to April 2026 was 0.9 per cent, a significant slowdown from the 1.9 per cent average recorded over the previous three years, when hiring across the public sector provided stronger support.

Meanwhile, the unemployment rate has risen by 0.4 percentage points since December 2025.

According to the report, Australian executives ultimately expect productivity to rise because of AI over the next three years.

And, unlike their US and UK counterparts, Australian executives ultimately expect employment in their firms to rise due to AI, rather than fall; an assumption that is consistent with CSIRO analysis of job posting data between 2020 and 2023, which showed that AI-adopting firms in Australia are advertising for more jobs with broader skills, in comparison to firms that have not adopted AI.

Rogers cautioned that the rapid integration of these technologies into the workforce is set to redefine professional landscapes at an unprecedented pace.

“The volume of investment in AI over the past years suggests that AI will likely move along the adoption curve much faster than previous technologies, creating winners and losers in the process,” she said.

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