What: AI-driven transformation is rapidly reshaping retail workforce structures, skills, and talent strategies.

Why it is important: These changes highlight the need for systematic upskilling and balanced AI-human integration, as confirmed by recent industry research.

The retail industry is experiencing a rapid transformation as AI integration accelerates, fundamentally reshaping workforce structures, required skills, and talent strategies. Recent research from September 2025 highlights that only 36% of retail workers feel prepared for AI-driven change, underscoring the urgent need for foundational skills such as adaptability and collaboration. At the same time, generative AI is altering the employment landscape, particularly for entry-level roles, with leading retailers focusing on augmenting rather than replacing human talent to achieve sustainable productivity gains. Despite widespread adoption, only 10% of retailers successfully scale their AI initiatives, but those who do outperform peers significantly, as shown by a seven-percentage-point advantage in five-year total shareholder returns. The shift toward skills-based organisations is evident, with 72% of retail workers now using AI tools, yet systematic upskilling remains a critical gap. The competition for AI-native talent is intensifying, with specialists seeking autonomy, growth, and meaningful projects over traditional benefits. These developments signal that the future of retail will be defined by organisations that can effectively blend technological innovation with human capability, ensuring both operational excellence and workforce resilience.

IADS Notes: In September 2025, research confirmed that foundational skills are now central to retail workforce adaptability, with only 36% of workers feeling prepared for AI-driven change. The same month, data from the Stanford Digital Economy Lab revealed that generative AI is most disruptive for entry-level roles, emphasising the importance of augmentation over replacement. July 2025 findings from BCG showed that only 10% of retailers successfully scale AI, but those that do achieve a seven-percentage-point lead in five-year TSR. Also in July, BCG reported that 72% of retail workers use AI, yet systematic upskilling is urgently needed. In June 2025, Forbes highlighted the growing competition for AI talent, with preferences shifting toward autonomy and meaningful work.

AI is moving faster than your workforce strategy. Are you ready?