As thousands of bank staff found out this week, the future of work’s already here

1 day ago 7

Opinion

Updated September 12, 2025 — 5.27pm

Australia’s banking sector has just offered a glimpse into the future of work – and it’s a future many employees will find unsettling. ANZ’s decision to cut 3500 jobs and 1000 contractors, followed by NAB’s move to slash 410 roles and shift more work offshore, is not simply another round of cost-cutting. It is a signal of how artificial intelligence (AI) and digitalisation are reshaping the labour market with extraordinary speed and precision.

ANZ’s restructure under new chief executive Nuno Matos is framed in terms of “efficiency and competitiveness”.

For ANZ, the restructure under new chief executive Nuno Matos is framed as a bid for efficiency and competitiveness. But beneath the corporate language lies a reality: automation and AI are hollowing out roles once considered secure. Back-office operations, compliance reporting and customer service functions are increasingly being run by machines rather than people. NAB’s restructuring reinforces the trend, moving technology roles to India and Vietnam where labour is cheaper, while AI and digital platforms reduce the need for large support teams in Australia.

The result is a labour market undergoing what economists call “polarisation”. High-value roles in strategy, leadership and advanced data science remain firmly in place. Low-cost, offshore jobs pick up some of the slack. But the middle – clerical workers, operations staff and mid-level technicians and administrators – is shrinking at an alarming rate. These are precisely the roles that have long underpinned Australia’s middle class, offering stable employment and clear career progression.

What is happening in banking is not unique. Across industries, employers are experimenting with AI tools that streamline processes, reduce error rates and cut costs. In insurance, AI tools are already handling claims processing with greater accuracy than human staff. Retail giants are trialling AI-driven inventory and logistics platforms that can eliminate entire categories of warehouse roles. Even in healthcare, AI is beginning to take on diagnostic tasks once considered the sole domain of specialists.

The labour impact rarely arrives in a single, headline-grabbing wave. Instead, it unfolds in rolling restructures, attrition and “quiet lay-offs”. The lay-offs announced this week are simply the latest crest in that wave.

For workers, the implications are sobering. Retraining and upskilling will be essential, yet the pathways are unclear. Roles in cybersecurity, AI governance and digital product design are growing, but they are fewer in number, often require specialist skills and – as NAB’s strategy shows – can just as easily be created overseas.

Unions have already framed the job cuts as a betrayal, particularly given the banks remain highly profitable. That accusation underscores a deeper social question: will the productivity gains from AI be broadly shared, or will they primarily accrue to shareholders? If the latter, then Australia risks deepening inequality and eroding public trust in its corporate leaders.

Policymakers face an urgent challenge: how to preserve a robust middle class in an economy where technology relentlessly squeezes out mid-tier roles. Ideas such as lifelong learning subsidies, portable benefits for gig and contract workers and even universal basic income are being debated internationally as potential safeguards. Yet in Australia, the policy conversation has lagged the technological change.

Australia has invested modestly in AI literacy through initiatives like the federal government’s AI Action Plan, micro-skills programs and school pilots, but efforts remain limited, fragmented and underfunded compared to global peers. Coverage is patchy, with regional and disadvantaged communities at risk of being left behind. Without stronger action, AI could worsen inequality, displace mid-career workers, and undermine competitiveness.

More ambitious measures are needed: integrating AI literacy into school curriculums, expanding subsidised retraining, ensuring equitable access to technology and setting clear national targets. Without drastic steps, Australia risks falling behind economically and socially in the AI era.

The ANZ and NAB announcements are, in effect, a preview of a larger structural adjustment looming over the labour market. They show how AI will not just alter tasks but redefine the very geography of work, shifting jobs offshore while concentrating value at the top. For employees, communities, and governments alike, the message is clear: the future of work is already here – and the time to grapple with its consequences is now.

Shumi Akhtar is an Associate Professor of Finance at the University of Sydney Business School.

The Opinion newsletter is a weekly wrap of views that will challenge, champion and inform. Sign up here.