External signal·CEPR / VoxEU·Mar 12, 2026·Ivan Yotzov, Jose Maria Barrero, Nicholas Bloom, Philip Bunn, Steven Davis, et al.·9 min read
Firms predict an AI productivity boom is coming
“On average, firms across the four countries expect AI to lower employment by around 0.7% over the next three years, or around 0.23% per year.”
Summary
Drawing on identical surveys of more than 5,000 CFOs, CEOs and senior executives across the US, UK, Germany and Australia, run November 2025 to January 2026, the authors find AI is widely adopted but has barely moved firm outcomes so far. About 69% of firms use some AI (78% in the US), yet more than 90% report no employment effect and 89% no productivity effect over the past three years. Looking ahead, firms expect AI to raise productivity by about 1.4% and cut employment by about 0.7% over the next three years. The expected employment cut is largest in the UK (-1.4%) and US (-1.2%), with about two-thirds of the UK reduction coming from reduced hiring rather than exits. A parallel US worker survey finds employees far more optimistic.
Predictions for the future of work
Over a three-year horizon, surveyed firms expect AI to modestly lift productivity (about 1.4%, led by the US at +2.3%) while modestly reducing headcount (about -0.7% on average, -1.2% in the US, -1.4% in the UK). Roughly two-thirds of the expected UK employment reduction would come from hiring fewer new workers rather than laying off existing staff, pointing to a slowdown in net new openings rather than mass displacement. The authors caution the figures cover existing firms only and exclude jobs created by new businesses, and note a sharp optimism gap with workers.
Originally published by CEPR / VoxEU · Mar 12, 2026
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