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Financial Firms Expect AI-Driven Job Cuts But Are Not Ready For Workforce Shift

Financial services firms are accelerating AI adoption, but many remain underprepared for the workforce changes that could follow, according to a PwC survey. Among more than 1,000 senior executives, 42% said their firms had modeled AI’s impact on workforce needs. Nearly 80% nevertheless expect their workforces to shrink by at least 20% over the next five years.

Firms Are Modeling Job Cuts, Not The Future Workforce

PwC said firms are focusing on how many roles AI could eliminate without fully defining the workforce they will need. Only half of companies that have started workforce modeling have examined how AI-driven process changes could affect staffing.

The findings come from PwC’s 2026 Financial Services Workforce AI Survey of US financial services firms, covering hiring, skills, compensation and leadership.

Pressure To Adopt AI Is Rising

Ninety per cent of executives said companies need to become more comfortable moving quickly, while 77% said their own organizations are not moving fast enough on AI. Another 70% said their firms are already accelerating adoption to remain competitive.

Employee concerns are adding to the challenge. Forty-four per cent cited worries about job security or changing roles, while 43% said workers use AI only when required. Another 40% said employees feel overwhelmed by the pace of change, and 34% cited change fatigue.

AI Skills Are Gaining Value

Ninety-one per cent of executives said their firms were increasing pay for employees with AI skills, while 58% planned to link compensation to AI-driven productivity gains.

Eighty-six per cent said AI skills training was more valuable than an MBA for many new hires. Over the next year, 62% plan to hire AI specialists, 61% intend to retrain existing staff and 57% expect to use outside providers.

AI Will Affect Jobs Unevenly

PwC said AI is increasing the value of roles that rely on human judgment, critical thinking, team-building and creative problem-solving. These “professionalised” jobs are growing twice as quickly as roles where AI makes specialist tasks accessible to non-experts, while wages are rising 42% faster.

Most AI Investments Lack Measurable Returns

Nearly half of executives identified productivity as a primary workforce objective, while 48% want to reduce time spent on routine work and 46% are focused on embedding AI into daily workflows. Technology and software engineering, risk management and operations are expected to deliver the largest productivity gains. Yet 77% said most of their AI investments are not generating measurable returns.

PwC recommends setting performance benchmarks and financial targets before investing rather than adopting AI simply because competitors are doing so.

Data And Governance Remain Obstacles

Poor or fragmented data was identified by 41% of executives as the biggest obstacle to scaling AI across the workforce. Governance also remains unresolved. Nearly 90% said their firms have clear accountability for AI-agent decisions, but executives differed over who should bear responsibility when an AI system causes significant harm: 27% cited the CEO and board, 16% technology leaders, 15% risk and compliance leaders and 12% business unit leaders.

Meanwhile, 90% said unauthorized “shadow AI” use creates regulatory risk. PwC said firms need clearer accountability, formal deployment processes and tighter controls over approved AI tools.

The survey covered 1,004 director-level and above executives at US financial services companies with at least $500 million in revenue. Respondents were surveyed May 12–22, 2026, across asset and wealth management, banking and capital markets, insurance and private equity.

EU Agrees On Major Overhaul Of Financial Market Supervision

European Union finance ministers have reached agreement on a sweeping package designed to strengthen oversight of the bloc’s financial markets, in a move aimed at reducing fragmentation and improving the flow of capital across borders.

A Push To Deepen Capital Markets

The Market Integration and Supervision Package, or MISP, would grant the European Securities and Markets Authority direct supervision over major market operators that are currently regulated by national authorities. The reforms are intended to make Europe’s capital markets more integrated, more efficient and better able to channel savings into productive investment.

According to the Irish presidency, the package is meant to help savings and investments move more freely across the European Union, improving access to finance for companies while giving households broader opportunities to earn returns on their savings.

What The Reform Would Change

Under the new framework, ESMA would take direct oversight of key trading venues, clearing houses, securities settlement bodies and crypto-asset service providers. The package would also establish a permanent, independent executive board within the regulator, strengthening its institutional capacity.

Market operators would be able to opt into a new EU-wide operating framework. In parallel, the reforms would seek to make national supervision more consistent and update rules governing trading, transaction completion, investment management and the use of blockchain technology.

Why The Agreement Matters

Supporters of deeper capital markets argue that Europe has long paid a price for regulatory inconsistency. While many rules are harmonised across the bloc, differences in enforcement and supervision have contributed to a patchwork system that can make cross-border investment slower and more costly.

A more integrated framework, proponents say, could lower costs for companies seeking funding and broaden the menu of investment options available to savers and institutional investors alike.

Outstanding Questions Remain

Despite the broad agreement, some important details remain unresolved. Trading venues operated by Deutsche Börse, the company behind the Frankfurt stock exchange, may remain outside ESMA’s direct supervision.

Euronews previously reported that Germany had secured an exemption for Deutsche Börse’s domestically focused trading venues, leaving part of the system under regional supervision. The latest announcement did not clarify whether that arrangement will stand.

A Step Forward For The Savings And Investments Union

Dutch Finance Minister Eelco Heinen welcomed the deal, calling it a major advance for the Capital Markets Union and saying Europe had made more progress in 10 months than in the previous 10 years.

The agreement is an important milestone in the Savings and Investments Union, the EU’s broader effort to channel more of Europeans’ savings into investments that can support growth, innovation and competitiveness across the bloc.

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