The UK economy has had easier times. Over the last two years, it has had to weather the global impact of the pandemic, and closer to home, the fundamental change to its trading relationships and supply chains caused by Brexit. With inflation in the ascendancy, energy costs on the rise, and threats from all sides such as Russian aggression in the East, it isn't going to get any easier. However, this moment of acute problems could be the driver of AI's greater adoption to meet the challenges.
Like other mature economies, the UK has also struggled with the long-term issue of low productivity. Simply, the economy is not utilising its resources such as its workforce as efficiently as it can, impacting growth. With all the other problems, fixing productivity is becoming a necessity if the UK economy is to thrive in the future. Governments have repeatedly come up with plans to address the issue, offering tax incentives and skills programmes, but it's not clear whether the problems are being resolved. They are entrenched. A recent article in Engineering & Technology cited some of the factors causing low productivity in the UK. These included poorly trained workers, low investment in equipment that might save labour, and the problems of measuring productivity in an economy much more reliant on services and IT than many of its peers.
The pandemic and Brexit have hit the supply of labour, which while good for workers in the short term as wages rise, companies will struggle with rising costs and reduced demand in the long term. However, rising labour costs are traditionally a spur for investment in technology to minimise labour reliance.
So, tor the introduction of more technology and tools like AI into the UK economy, we could be at what Mrs Thatcher called a TINA moment. There Is No Alternative. Investing in new technology like AI and acquiring the skills needed to implement these tools is now critical for companies. Those put off by the potential cost, risk, and lack of understanding will need to get on board.
For the UK, this point about the economy's focus on services or the knowledge economy is critical. AI can play a crucial role. Put simply - AI allows knowledge workers to be more productive by automating mundane tasks. A considerable amount of work time is bureaucracy, old-fashioned paperwork. Getting clients to fill in forms, organising contracts, and creating sales lists are just some of the many necessary tasks that drag on productivity. The more time staff spend doing this, the less time they focus on things that serve the bottom line. AI opens a world where machines can generate contracts, assess potential sales leads, or handle customer queries. For the state, where finding ways to save money without cutting services is vital, AI offers a promising, if politically challenging, solution. Concerns around data use, privacy, and the fear of algorithms will need to be addressed before the large-scale deployment of AI in the public sector.
That said, the future for AI in the UK looks promising. Economic circumstances mean that companies are looking for ways to succeed. The Government has promised to make the UK an AI powerhouse. AI was even cited as part of the rationale for Brexit. Freeing the UK from the EU's more conservative approach to regulation to allow AI to thrive. Whether this will happen is still up for debate, but the direction of travel is clear.