Soon after the recruitment agency Reed launched its first website from an internet cafe called Cyberia in the 1990s, a news article said: “James Reed thinks in the future people will be sending their CVs by email,” the son of the company’s founder recalls.
Thirty years on, James Reed, now chief executive, is once again scrambling to make sense of new technology, this time as artificial intelligence (AI) begins to upend the labour market. “2025 does feel quite like 1995,” he says.
The agency, started in 1960 by Reed’s father Alec as one Hounslow store, is now among the largest and most recognisable jobs companies, with annual revenue of more than £1 billion (€1.14 billion). Its website is used by 85 per cent of the UK’s top recruitment firms and it also runs bricks-and-mortar jobs agencies, provides temporary workers and specialised hiring services in sectors such as graduate jobs and healthcare, and runs workplace learning programmes.
But revenue dropped last year due to a decline in job postings in a cooling labour market.
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To adapt, the company is developing an AI agent, a trial service that will target small businesses short on time and money. It searches Reed’s database of millions of potential jobseekers to create a shortlist of candidates.
The approach to building AI tools is similar to launching its first website, when Reed says the spirit was “let’s just have a go, have a look, and then we’ll see what happens”.
He says the AI will not reject people – “I think that is really not right.” Rather, it raises what are known in the industry as “passive candidates” – people who fit the criteria for a job but are not actively looking for roles. Individuals or organisations are suggested by AI, but decisions to progress an application are in human hands.
“Does the opportunity get their attention sufficiently to motivate them to have a look? Sometimes, sometimes not – it’s up to them.”
The technology has some flaws. Fairly big ones. “It doesn’t work very well,” Reed says bluntly. “The website didn’t either when it started.” After 18 months, “it works, but we want to make some more improvements ... It’s not a panacea”.
Large language models have made it easier for workers to make applications to hundreds of jobs, leaving employers struggling to sift through huge numbers of cover letters and CVs.
The issue is exacerbated by a crowded labour market, which could become even more competitive as AI starts to do more tasks. That has opened recruiters up to a litany of criticism, from ghosting applicants, to discrimination, if AI makes – or appears to make – biased decisions.
Reed also sees other problems. Compared with old ways of working, such as setting up calls and meetings, AI can quickly and easily identify potential candidates but it cannot know if they will pursue a role, or persuade them to do so.
“I’ve been saying to colleagues for years, if you want someone to do something, don’t send them an email, ring them up,” he says. “But that’s the thing – AI sends you emails.” Assessing and motivating workers to move jobs needs the human touch. “The challenge is getting people to move ... People like dealing with people.”
Reed, who worked for employers including Saatchi & Saatchi and the Body Shop before joining the family business, has bigger worries about what AI means for the overall labour market. “I’m concerned about what it might do more widely to jobs,” he says.
Reed (62)
is highly critical of the British government’s employment rights bill, particularly day one rights and budgetary changes, which have made hiring workers more expensive.
But he also believes AI is “in certain areas, destroying jobs quite quickly”.
One red flag is graduate roles, which, at Reed, declined from more than 180,000 postings in 2021, to 55,000 last year, and look set to fall further in 2025.
The problem, he argues, is “unfortunate” timing: increased costs and stagnating growth make hiring unattractive just as a new technology emerges that could replace some human work, giving an “impetus” to put the brakes on recruitment. “Businesses will say, hang on, maybe we won’t hire, or they will look at automation.”
Reed says the new technology can be “transformative” but exactly how it might change his industry in a big way is less obvious.
“These are unknowns, aren’t they? I think our AI will become a part of our service offering. I don’t think it will consume everything else, because a lot of people don’t want to interact in that way.”
The threat to jobs seems more imminent than huge benefits. Reed is worried about the “odd” contradictions in today’s economy, where growth, even if “pathetically small” is happening as vacancies fall. “It’s an interesting time,” he says. “I don’t want to depress your readers.” – Copyright The Financial Times Limited 2025
