For the past few years, the public sector conversation about AI and digital transformation has largely focused on adoption, where technology can be deployed, what can be automated and how organisations can introduce responsibly. Looking ahead to 2027 and beyond, the real question for HR directors will be much larger – if AI changes how work gets done, how must our workforce and organisation change with it?
This represents a significant shift. AI is no longer simply a technology implementation challenge. It is becoming a workforce, skills and organisational design challenge, with implications for the roles organisations need, the capabilities people require and how work itself is structured.
Skills England has highlighted AI, digitalisation and automation as important drivers of changing employment and skills requirements, alongside the need to build responsible and inclusive AI capability across the workforce. For public sector HR leaders, that places people strategy firmly at the centre of the AI agenda.
The challenge is that while HR already possesses many of the capabilities required to lead this transition, applying them in an AI-driven environment is less familiar territory. The Chartered Institute of Personnel and Development's How AI is changing the application of HR skills highlights this gap. HR leaders may be experienced in workforce planning, job design and employee engagement, yet confidence falls when these disciplines are applied to AI-led organisational change. Only around a third of HR leaders surveyed felt confident estimating future workforce requirements resulting from AI, with 40% confident in designing reskilling pathways and 46% in leading job redesign.
For the public sector HR director of 2027 therefore, the opportunity is not simply to help the organisation adopt AI – It is to lead the redesign of the workforce around it.
From automating tasks to redesigning work
The first phase of AI adoption has understandably concentrated on productivity: automating administration, accelerating processes and helping people work more efficiently. The next phase should go deeper.
Rather than asking which jobs could AI replace?, HR directors should be asking which activities require uniquely human capability? Which tasks can technology augment? How should roles change? And what skills will the organisation consequently need?
That shifts the debate from job reduction to job redesign.
For local government in particular, that conversation sits alongside significant existing pressures around transformation, organisational capacity and changing service expectations. The opportunity is therefore not simply to introduce AI into today's structures, but to question whether those structures remain right for tomorrow.
The HR director as ‘organisation architect'
This could fundamentally change the contribution expected from HR leadership.
The HR director of 2027 cannot simply be the leader of the people function. Increasingly, they will need to become an architect of the organisation, helping executive teams understand how people, skills, technology and organisational design should fit together.
Strategic workforce planning consequently becomes critical.
HR leaders will need stronger insight into existing organisational capability, emerging skills requirements, workforce capacity and where technology could reshape the deployment of people. Government research already points towards the importance of AI upskilling that is employer-informed, inclusive and responsive to different workforce needs.
This demands a different type of HR capability: commercially aware, technologically curious, confident with data and insight, and able to translate workforce intelligence into organisation-wide decisions.
Keeping transformation human
There is, however, a danger in allowing workforce redesign to become an exercise conducted to people rather than with them. Employees will inevitably want to understand what AI and digital means for their role, career and future employability.
The response cannot simply be reassurance. It requires honesty, engagement and investment in skills.
Public sector organisations will need to create environments in which people can experiment with new technology while understanding its limitations and their responsibilities in using it. Skills England's work highlights both responsible AI and digital competencies and unequal access to learning as important workforce considerations.
The opportunity for HR
The strongest HR directors will therefore resist framing AI as either an existential threat or a universal solution, instead, they will ask something much more valuable: how could we redesign work around the best combination of human capability, technology, skills and organisational purpose?
That is where the opportunity for HR lies.
By 2027, the defining question may no longer be whether HR has successfully supported AI adoption, rather it will be whether HR has stepped forward to shape the organisation and workforce that emerges from it.
Jason Wheatley is partner, executive interim at Faerfield
