Many of Britain’s large businesses are ready to replace staff with artificial intelligence over the next year, according to a prominent survey of chief financial officers.
Deloitte said on Oct 14 that 52% of CFOs expect to cut headcount due to the technology, with AI adoption still in its early stages. More than two thirds – 67% – said they have achieved just a quarter of the changes they ultimately expect from AI.
The report adds to evidence of Britain’s jobless growth revival, which poses a political dilemma for Prime Minister Andy Burnham’s Labour government.
AI adoption and high employment costs are encouraging firms to expand with fewer roles. As a result, long-term unemployment is rising and youth joblessness is at its highest in over a decade – an anomaly in an economy that is whizzing past European peers.
It underscores the challenge facing AI Minister Kanishka Narayan, who pledged to “never leave working people to bear the cost” of the AI revolution, in a speech on Oct 12.
“I understand why people are naturally anxious about their jobs and what artificial intelligence means for their children’s future,” Narayan said. “I feel that concern, that anxiety too.”
While firms are using AI to cut costs, the impact on profits is less certain. Only a third of CFOs believe AI will help increase margins in the next year, according to the Deloitte report.
Deloitte surveyed 66 CFOs between Sept 17 and Oct 1. Of those, 12 were from FTSE 100 companies and 25 from FTSE 250 companies.
A separate report published this week by Multiverse, the London-based training platform founded by Euan Blair, suggested firms are struggling to join up AI investments with their existing workers.
“Almost none of them know what their people can do with AI, and that is where their spend is going to waste,” Blair said. The report said firms are spending more on AI tools without training their workers how to use them. BLOOMBERG