ARTIFICIAL intelligence (AI) use in UK businesses with 10 or more employees has increased from around 12% to around 35% since late 2023, with larger firms more likely to have adopted AI, a new government survey has found.
One business owner said AI is “adding real value” to the way his firm operates but a professional CV writer said it “is ripping my personal income from under my feet.”
Meanwhile, AI experts have warned that many businesses are becoming dangerously leveraged on a technology that has yet to show its true cost.
To date, the survey revealed, AI adoption has been relatively shallow among UK businesses with 10 or more employees, with the average number of AI technologies used per adopting business rising only modestly, from around 1.4 to around 1.6 since late 2023.
The technology started entering the mainstream after the launch of ChatGPT in November 2022.
The survey found AI use varies across industries, with over half of businesses in information and communication (58%) reporting using the technology, compared with much lower levels in construction (13%).
Improving business operations is the most common use of AI, reported by over 60% of larger businesses. But the survey found this has not yet translated into widespread changes in overall workforce headcount.
Over half of businesses surveyed reported effects on creative or design roles when using visual content AI technologies, while a similar proportion report effects on administrative or clerical roles when using AI image processing.
AI impact
South Croydon-based professional CV writer, Jen David, said “AI is taking jobs and is ripping my personal income from under my feet”.
She continued: “I personally have lost private clients, who use AI to write their CV, and am starting to lose corporate clients, who are replacing the human voice with AI-generated writing and editing.”
Kate Underwood, Founder at Southampton-based Kate Underwood HR and Training, said she uses AI every day but that “it hasn’t replaced a soul” and could end up in a lawsuit if sufficient governance and oversight are not in place.
She added: “It’s the sharpest little process assistant I’ve ever had, quietly making sure nothing slips through the cracks. It flags what’s due, chases the loose ends and finally drags us off the paper and online, where things actually get done.
“Has it stopped me hiring? Not a chance. It hasn’t cost anyone their job. It’s simply helped my people do more, and do it better. AI handles the admin, my team handles the humans.
“Now for the bit everyone skips. AI is a brilliant assistant and a terrible boss. Lean on it blindly, skip the governance, and you’re one confident hallucination away from a very awkward tribunal.”
Value
Paul Denley, CEO at London-based Oakham Wealth Management, said “AI is already adding real value to our business, particularly in research, analysis and producing first drafts”.
He added: “The best way to think of it is like hiring a bright graduate: fast, capable and impressive, but prone to mistakes, so everything it produces needs a senior pair of eyes.
“It allows people to work faster and spend more time on higher-value tasks, and has probably reduced the need for incremental headcount rather than directly replacing jobs.
“The risks are equally real. Businesses can become over-reliant on tools they don’t fully understand, while poor governance creates obvious risks around data, accuracy and accountability.
“Perhaps the greatest long-term risk is that people stop questioning the output: AI should support human judgement, not gradually replace it.”
Cost
Harvey Dhillon, Founder at small business accountants, Zmartly, said he uses AI heavily while also being “a bit of a doomer about it”.
He continued: “At Zmartly it drafts, researches and clears the admin that used to swallow hours, and honestly it has not replaced anyone. But the question that keeps me up is not this year’s headcount, it is which jobs are still here in five years.
“We are automating the entry-level work that used to teach people the trade, and you cannot grow a senior from nobody. On the risks, the one I watch most is cost. You are billed by usage, the provider can raise the price at any stage, and you have no say in how much.
“Today’s rate is an introductory rate. By the time it climbs you have designed the manual alternative out, so you simply pay. Scale with it, but keep asking what still stands when the price moves and the edge is gone.”
Meanwhile, Lukas Kaminskis, CEO of EdTech platform, Turing College, said: “These figures show AI is no longer a future trend, it’s becoming a standard business tool. The real challenge now isn’t whether companies adopt AI, but whether their staff know how to use it effectively and responsibly.
“Too many businesses are investing in the technology without investing in the skills needed to unlock its full potential. AI should help employees work smarter, not replace them, but that only happens if people know when to trust its output and, just as importantly, when to challenge it.
“The most valuable AI skill isn’t writing prompts, it’s having enough expertise to spot when the model gets something wrong.
“Companies also need to think beyond adoption. Many are using AI without clear policies on what data can be entered, who owns AI-generated content or how decisions are audited.
“The businesses that gain a lasting competitive advantage will be those that combine employee upskilling with strong AI governance, giving staff the confidence to use these tools productively, responsibly and securely.”
Tokenomics
AI experts said many business owners do not understand the true cost of AI, which is currently being subsidised by massive venture capital inflows.
Colette Mason, AI Ethics Consultant at London-based Clever Clogs AI, who works with companies of all sizes on their AI adoption daily, said: “In my experience, the vast majority of UK SMEs are trying to build an economy on a technology whose true costs they simply do not understand.
“Today, tokenomics, or the true cost of compute, doesn’t mean much to most SMEs but in the not-too-distant future it could be their epitaph if they don’t get to grips with it, fast. Failing to model the costs of AI correctly could see many businesses fail.
“Only businesses using pay-as-you-go (API) billing understand the real cost of AI. Flat-rate subscriptions are heavily subsidised to bring in users, effectively hiding the true cost of compute.”
Danger
It’s a view shared by Mitali Deypurkaystha, Human-First AI Strategist at Newcastle upon Tyne-based Impact Icon AI, who said “many British businesses are behaving like they’ve been handed free samples without realising the dealer eventually comes back with the bill”.
She continued: “As an AI strategist, one of the biggest parts of my job is often explaining where businesses should not use AI. Too many owners see cheap subscriptions and assume automation belongs in every workflow whether the return on investment exists or not.
“I’ve had to push back on companies wanting to force AI into processes where the gains simply weren’t there, especially when today’s bargain pricing is heavily subsidised and may not reflect the true long-term cost.
“AI will absolutely transform the economy, but too many SMEs are rebuilding their operations around tech whose future pricing and operating costs they barely understand. The danger is that by the time those costs rise sharply, businesses may already be too dependent to walk away.”
Rohit Parmar-Mistry, Founder at Burton-on-Trent-based Pattrn Data, also urged businesses to be cautious: “The sensible question is not whether agents are useful. Some clearly will be.
“It is whether the value of each task is greater than the compute, supervision and error-management cost behind it. If that maths is vague, token burn becomes margin burn.”
