What's Happening?
A recent study conducted by Accenture highlights that UK multinational companies are among the leading adopters of artificial intelligence (AI) in Europe. The study surveyed 800 European companies with annual revenues exceeding £740 million and found that 49% of UK firms have scaled at least one strategic AI initiative. Despite this progress, the study notes that the United States continues to outpace the UK in AI adoption, which could widen the productivity gap between the two economies. Larger UK multinationals, particularly those with revenues over £7.4 billion, are embedding AI technologies across key business areas, investing in talent, infrastructure, and integration to drive increased value and returns. However, more than half of major British organizations have yet to fully capitalize on AI's potential.
Why It's Important?
The findings underscore the potential for AI to significantly boost the UK economy, with Accenture forecasting that responsible and scaled AI implementation could add up to £736 billion to the UK's annual GDP by 2038. The study emphasizes the need for broader and faster AI adoption beyond multinational firms to prevent an AI gap that could lead to a divided economy. The UK has the opportunity to transform sectors like services and creative industries, where it is a global leader, by embracing AI. However, the slower diffusion and adoption of technology compared to the US could mean that the UK continues to lag in economic output, with the average European worker generating just 76% of the output of their US counterparts.
What's Next?
To close the productivity gap with the US and compete globally, UK business leaders must ensure that AI implementation is sustained, holistic, and done at scale. Coordinated efforts are needed to build AI capability and infrastructure across the UK economy. The study suggests that embracing AI is crucial for unlocking growth and empowering people at work, particularly as the UK seeks to overcome stagnant productivity.
Beyond the Headlines
The study highlights the ethical and strategic dimensions of AI adoption, emphasizing the importance of responsible implementation to avoid exacerbating economic divides. The potential transformation of sectors like services and creative industries could lead to long-term shifts in the UK's economic landscape, positioning it as a leader in AI-driven innovation.
