British Gas cuts 1,300 call centre jobs, cites AI and customer shift

Centrica, the FTSE 100-listed owner of British Gas, announced plans to eliminate 1,300 call-centre jobs as part of a shift toward digital customer service and AI-assisted operations. The cuts include 800 roles being removed through what the company calls a "targeted deployment of AI tools," plus 500 job losses that Centrica confirmed last month. Customer service teams in Glasgow, Edinburgh, Cardiff, Leicester, Stockport, and Leeds will shrink by 14% over a two-year period, with reductions achieved through a combination of unfilled vacancies after resignations and formal redundancies.

Centrica's Chief Executive Chris O'Shea defended the move by arguing that customer behaviour, not AI, is the primary driver. He stated: "AI isn't driving these particular job reductions; that's mainly due to changing customer behaviour. What we're seeing just now is over 90% of our customers actually use digital channels in the first instance, and we've seen a 20% reduction in customer calls, so this simply reflects the changing customer behaviour." O'Shea added that the company expects to grow roles around its digital interface and have fewer people answering phones. However, trade unions have previously warned that Centrica's investment in AI would result in "hundreds of human jobs" being shifted to chatbots.

The announcement comes as Centrica reported stronger financial results despite losing customers. The company's retail division — which encompasses British Gas revenues, boiler care, and smart energy products — posted profits of £346m for the first half of the year, up from £338m in the same period last year. This profit growth occurred even as British Gas domestic customers declined to 7.45 million from 7.5 million at year-end, because the supplier has focused on higher profit margins from fixed-price tariffs rather than pursuing what O'Shea called "loss-making business." Separately, British Gas is facing a major compensation bill of up to £112m to thousands of customers who had prepayment meters force-fitted during the Russian gas crisis — the largest energy supplier settlement on record — and has gradually lost market share to rival suppliers in recent years.

Centrica's announcement reflects a broader tension in how companies frame workforce reductions tied to technology. The firm is presenting its 1,300-job cut as a natural response to customer preference for digital channels — a claim supported by its own data showing over 90% of customers using digital channels first and a 20% decline in calls. Yet this framing sits alongside a simultaneous "targeted deployment of AI tools," which trade unions view as the actual driver of the job losses. The company's retail division actually grew profits to £346m (from £338m year-on-year) while losing domestic customers, suggesting that margin improvement, not demand collapse, is the underlying strategy.

Centrica's positioning also comes at a time when British Gas faces reputational and financial pressure. The company is facing a £112m compensation bill for thousands of customers who had prepayment meters force-fitted during the Russian gas crisis — the biggest energy supplier settlement on record — and has steadily lost market share to rival suppliers. By emphasizing customer behaviour rather than cost-cutting through automation, the company may be attempting to insulate itself from further criticism. However, the two-year implementation timeline, which relies partly on unfilled vacancies and partly on redundancies, suggests the changes are deliberate and structural rather than merely reactive to shifting demand.

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