AI could boost UK economy by £400bn, says Google

AI could boost UK economy by £400bn, says Google
Dan Martin
Dan MartinDan Martin Content & Events

Posted: Fri 14th Jul 2023

Artificial intelligence tools could provide a £400bn boost to the UK economy if policies are introduced that enhance research and development and improve digital skills, according to a report by Google.

In new analysis of its economic impact, the internet giant said AI technology could save the average UK worker over 100 hours a year, with teachers and GPs saving more than 700,000 hours in administrative activities.

The data, which Google commissioned from research group Public First, also claimed that the use of AI tutors and coding assistants could make it easier for people to improve their digital skills, boosting UK productivity by over £4.8bn a year. The report said:

"In total, we estimate that these tools could create over £400 billion in value for the UK economy by 2030, the equivalent to an annual growth rate of 2.6%, or enough to end the recent growth stagnation.

"That is potentially a bigger boost to growth than the entire personal computer or internet revolution."

How the UK can maximise the benefits of AI

If the UK is to achieve the full benefits of AI, Google said government policy needs to focus on skills, research and development, pro-innovation regulation and infrastructure.

On skills, the report said two thirds of UK employers report difficulty recruiting workers with digital skills, so a new national skills service should be launched.

Secondly, Google highlighted figures by IPPR showing that the UK's share of global investment in research and development has fallen by a fifth since 2014.

The government, it said, "should increase the ambition of its target for public investment in R&D to consistently exceed the OECD average by 2030, while ensuring this funding is helping drive growth across regions with ring-fenced funding to support SMEs working on strategic technologies".

On regulation, Google called for impact assessments to ensure it supports innovation and doesn't become a barrier to growth, while on infrastructure the report said the UK needs to increase its large-scale computing capacity, and public access to it. As of November 2020, the UK only had 12 of the top 500 computer systems globally compared to 214 for China and 114 for the US.

In March, the government released a whitepaper "to guide the use of artificial intelligence in the UK, to drive responsible innovation and maintain public trust in this revolutionary technology".

Speaking to MPs on the Commons liaison committee, prime minister Rishi Sunak said AI could boost UK GDP by 10% and improve public services such as healthcare and education. However, he acknowledged "the socioeconomic risk from the large-scale societal shifts that the technology will bring"

In the autumn, the government will host what it describes as the first global summit on AI safety. It will "consider the risks of AI, including frontier systems, and discuss how they can be mitigated through internationally coordinated action".

Google Social Innovation Fund on AI

Google's Social Innovation Fund on AI will allocate £1m worth of funding to UK-based social entrepreneurs using AI to help their communities.

Successful applications will receive cash grants and mentoring. Entrepreneurs can register their interest for the fund now.

Relevant resources

Dan Martin
Dan MartinDan Martin Content & Events
I'm a freelance journalist and event host who helps small businesses and the organisations that support them. I'm also Enterprise Nation's news reporter and Bristol Local Leader. I have 20 years of experience as a small business journalist having interviewed hundreds of entrepreneurs from famous names like Sir Richard Branson and Deborah Meaden to the founders behind brand new start-ups. I've worked for a range of leading small business publications and support groups, most recently as head of content at Enterprise Nation where I was responsible for the prolific output of content on the company's blog and social media. I now freelance for Enterprise Nation as the website's news reporter and as the host of the Small Business sessions podcast. I'm based in Bristol where I run and host regular events with the local small business community in my role as Enterprise Nation's Local Leader for Bristol. I also have strong connections with other major business organisations in the south west region. In total, I've hosted over 100 events including conferences with an audience of hundreds for international brands like Xero and Facebook and live web chats from inside 10 Downing Street. With my partner, I co-run Lifestyle District, a lifestyle blog focused on culture, art, theatre and photography.

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