Artificial Intelligence development in London under threat due to skills shortage, Amazon alerts
London's AI Race:
London's businesses are sprinting ahead in the artificial intelligence (AI) race, leaving the rest of the UK trailing behind. A new study by Amazon Web Services (AWS) reveals that a whopping 67% of London-based firms have unleashed AI's potential, far outstripping the national average of 52%.
The capital's AI adoption rate has surged 40% annually, surpassing the UK's overall growth of 32%. London's startups are driving the trend, with these young firms 1.5 times more likely to be at the forefront of AI transformation compared to their regional counterparts.
However, the study raises concerns about a widening chasm in AI maturity across the UK. While large enterprises have warmed up to AI, only 14% of them are consistent players at the highest level of adoption. In stark contrast, over a third (34%) of startups have achieved this pinnacle, hinting at the advantages of agility and flexibility that smaller businesses enjoy.
The digital skills shortage looms as a major impediment to AI progress. Alison Kay, managing director for public sector at AWS, sounded the alarm at the AWS Summit, reporting that a third of UK businesses lament their lack of digital skills needed to implement AI solutions.
The AI Divide: Startups vs. Large Enterprises
Nationally, AI adoption among businesses has skyrocketed by 33% in the past year, eclipsing the European average of 27%. However, only 55% of large enterprises consistently use AI, while a mere 14% operate at the cutting edge of AI adoption.
On the other hand, over a third (34%) of startups have scaled their way to the top, indicating their ability to embed AI deeply into their operational models. The result: a two-tier economy, with startup titans grabbing the transformative potential of AI while larger enterprises risk missing out on significant productivity and innovation gains.
This digital divide could sneak up on businesses, with large enterprises responsible for nearly half of the UK's turnover. Failing to fully capitalize on AI's potential could mean significant missed opportunities.
Skills and Infrastructure: Major Hurdles
Across the UK, access to digitally skilled talent remains the most significant barrier to AI adoption. A growing number of businesses, 38% compared to 29% last year, struggle with digital skills shortages as a major constraint. Hiring for AI roles routinely takes five and a half months, and 41% of firms find it tough to recruit staff with suitable digital abilities.
To overcome these obstacles, businesses are starting to turn to independent software vendors (ISVs) and third-party providers. Among these companies outsourcing AI expertise, 57% tap into advanced functionalities, while 43% rely on outside partners for training.
AWS Steps In: Skills to Jobs Tech Alliance
Amazon Web Services (AWS) announced the launch of the 'skills to jobs tech alliance' in the UK, pledging to empower 100,000 students with pathways into AI, cybersecurity, and data roles by 2030.
"We're partnering with government, industry, and education to ensure the next generation has every opportunity to thrive in the digital economy," claimed Alison Kay.
The Public Sector: Paving the Way
The public sector is gearing up to be a key catalyst for national AI readiness. The Department for Work and Pensions, for instance, uses generative AI to sift through vulnerability cases, while Swindon Borough Council streamlines housing documentation processes with open-source tools.
Encouragingly, 78% of surveyed businesses believe increased government use of AI would prompt them to do the same, signaling a positive trend for AI adoption in the UK.
- In London's AI Race, startups are driving the trend, with over a third of them scaling their way to the top of AI adoption, surpassing the consistency of large enterprises.
- In the UK, while only 55% of large enterprises consistently use AI, over a third (34%) of startups have embedded AI deeply into their operational models, hinting at the advantages of agility and flexibility these smaller businesses enjoy.
- Skills and infrastructure gaps pose major hurdles in the UK's AI adoption, as revealed by a study that shows a third of UK businesses lament their lack of digital skills needed to implement AI solutions, and hiring for AI roles routinely takes over five months.
- In response, Amazon Web Services (AWS) announced the launch of a 'skills to jobs tech alliance' in the UK, aiming to empower 100,000 students with pathways into AI, cybersecurity, and data roles by 2030.
- As the public sector gears up to be a key catalyst for national AI readiness, the Department for Work and Pensions and Swindon Borough Council are already paving the way, employing AI to streamline processes and increase productivity.
