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UK Firms Eye AI to Cut Jobs, Youth Unemployment Hits 12-Year High

Deloitte Survey: Over Half of Large UK Companies Deploy AI to Replace Humans Within a Year, Youth Unemployment Reaches a High in More Than a Decade

A new report from Deloitte paints a stark picture of the UK job market: large companies are gearing up to swap human workers for artificial intelligence, and they're doing it fast. According to Bloomberg, the survey of chief financial officers (CFOs) found that 52% expect to use AI to cut staff in the coming year. Yet here's the twist—67% admit that AI has only delivered a quarter of what they hoped for. The technology is still in its infancy, but the axe is already being sharpened.

Deloitte polled 66 CFOs between September 17 and October 1, including 12 from the FTSE 100 and 25 from the FTSE 250. Their responses confirm a worrying trend: "growth without employment." Companies are adopting AI and facing high injury costs, so they're not hiring their way to expansion. The result? Long-term unemployment is climbing, and youth unemployment has hit its highest level in over a decade. The irony is hard to miss—this is happening in an economy growing significantly faster than its European neighbors.

The Minister Promises "Not to Leave Ordinary People Alone," but the Profit Picture Remains Murky

This puts the Labour government—led by Prime Minister Andy Burnham—in a tight spot, and AI minister Kanishka Narayan right in the crosshairs. In a speech on Monday, he vowed, "We will never let ordinary workers bear the cost of the AI revolution alone," and acknowledged public anxiety about jobs and the next generation's future.

But while companies are using AI to cut costs, they can't say for sure whether it'll boost profits. Only one-third of CFOs believe AI will increase profitability in the coming year. Meanwhile, a report this week from London training platform Multiverse, founded by Euan Blair, highlights the elephant in the room: companies keep buying AI tools but barely train employees on how to use them. "Very few companies know what their employees can actually do with AI," leading to wasted investments. You can buy the tech, but you can't buy the capability—and that might be the real crisis in the UK workforce.

Key Points:

  • 52% of UK CFOs plan to cut staff using AI within a year, per Deloitte.
  • 67% say AI has only met a quarter of expectations so far.
  • Youth unemployment is at a 12-year high, with companies experiencing "growth without employment."
  • Only 33% of CFOs expect AI to boost profits next year.
  • Training gap: Firms invest in AI tools but neglect employee training, risking wasted spending.