52% of CFOs surveyed by Deloitte expect many large UK firms to use AI to replace employees within the next year, though AI adoption is still at an early stage; 67% say firms have delivered only about 25% of the transformation they ultimately expect from AI. Companies cite AI and high labor costs as reasons to reduce headcount when expanding, contributing to rising long-term unemployment and youth unemployment at decade-plus highs despite the UK growing faster than many European peers. Only about

52% of CFOs surveyed by Deloitte expect many large UK firms to use AI to replace employees within the next year, though AI adoption is still at an early stage; 67% say firms have delivered only about 25% of the transformation they ultimately expect from AI. Companies cite AI and high labor costs as reasons to reduce headcount when expanding, contributing to rising long-term unemployment and youth unemployment at decade-plus highs despite the UK growing faster than many European peers. Only about one-third of CFOs expect AI to boost profit margins within the next year. The report says the trend reinforces a renewed 'no employment growth' dynamic and poses a political challenge for Prime Minister Andy Burnham's Labour government.