Employee resistance to artificial intelligence has become the biggest workforce risk facing businesses in the United Arab Emirates, surpassing cybersecurity concerns and rising healthcare costs, according to a new report by global risk advisory firm Marsh.
The company’s 2026 People Risks report found that “mindset barriers” to adopting AI ranked as the leading concern among UAE employers, highlighting the growing challenge companies face as they accelerate digital transformation.
The findings are based on responses from 103 human resources and risk professionals in the UAE, forming part of a wider survey of 4,500 professionals across 26 global markets.
The report said workforce-related risks have expanded beyond traditional human resources functions and are now closely tied to business continuity, cybersecurity, mergers and acquisitions, and regulatory compliance.
Following employee resistance to AI, the report identified inadequate cyber threat awareness, insufficient workforce due diligence during mergers and acquisitions, labour shortages and regulatory changes as the other major people-related risks facing UAE organisations.
The survey also revealed that many businesses continue to struggle with coordination between departments responsible for managing workforce risks. Only 40 percent of companies said their HR and risk management teams collaborate fully. Another 40 percent reported partial cooperation, while 20 percent described collaboration as minimal.
Marsh said stronger cooperation between HR, risk management, finance and senior leadership would help organisations respond more effectively to an increasingly complex business environment.
Companies are also increasing investment in employee training as AI becomes more widely used in workplaces. According to the report, 38 percent of UAE employers are training staff to identify AI-generated misinformation. Around 34 percent are addressing cybersecurity threats linked to AI tools, while 33 percent are encouraging employees to critically evaluate AI-generated content. Another 32 percent are focusing on preventing data privacy breaches associated with artificial intelligence applications.
Adel Alderi, Business Development Leader at Mercer Marsh Benefits UAE, said workforce-related risks are now directly connected to broader business performance.
He said organisations are facing multiple challenges at once, including AI adoption, employee wellbeing, rising healthcare costs and financial pressures, making workforce resilience a growing priority for employers.
Health and wellbeing remain major concerns despite AI emerging as the top risk. The report found that 62 percent of UAE companies expect healthcare and employee benefit costs to continue rising, while the same proportion believe unsafe physical or psychological working conditions could significantly affect their organisations. Nearly three in 10 respondents also said existing mental health support for employees remains inadequate.
Simona Musat, Multinational Leader at Mercer Marsh Benefits UAE, said employers increasingly recognise that workforce health plays a vital role in maintaining business resilience as medical costs continue to rise.
The report also warned that inadequate workforce due diligence during mergers and acquisitions could expose companies to financial, operational and reputational risks after deals are completed.
Compared with two years ago, the UAE’s workforce risk priorities have shifted significantly. Rising healthcare costs, technology skills shortages and diversity concerns previously topped the list, but AI adoption, cybersecurity awareness, M&A risks, labour shortages and regulatory changes have now become the dominant concerns for employers.
