Nearly two-thirds of UK organizations are now using AI, but the gap between basic and advanced applications is widening, threatening the wider economic value of the technology, according to new research from AWS.
Latest version of Amazon Web Services Unlocking the UK’s AI potential According to the report, 64% of UK organizations are currently using AI, a significant increase from 52% last year and the equivalent of one new company adopting AI every 40 seconds.
The report includes a survey of 1,000 business leaders and found that 68% of organizations report productivity gains from AI, and nearly three-quarters expect the technology to drive growth in the year ahead.
But these numbers mask more subtle challenges. This is because most organizations are still using AI for basic purposes such as summarizing documents or answering simple queries through off-the-shelf chatbots, effectively slowing down broader transformation. AWS equates this to owning a smartphone and using it only to make calls.
The data shows that only 24% of UK adopters have reached an advanced stage where AI forms part of their core business processes and decision-making, an increase of just 1% from last year.
AWS said this gap between basic and advanced AI deployments is important because the economic value scales with the depth of use. For example, when organizations use AI to redesign workflows, accelerate decision-making, and build new products and services, they report an average efficiency increase of 68%, compared to just 40% for basic users.
The report found that certain sectors, particularly healthcare and pharmaceuticals, represent huge untapped opportunities, with more advanced adoption only growing by 2% year over year, despite an overall AI adoption rate of 69%.
By closing the gap between basic and advanced AI adoption, the UK could deliver an additional £35bn of economic growth by 2030, roughly equivalent to the economy of Greater Manchester, but UK businesses will first need to overcome significant barriers slowing progress.
£16,000 premium for AI
Most importantly, almost half (49%) of organizations cited a lack of AI and digital skills as a key challenge, up from 46% last year. This suggests that the faster companies adopt AI, the more acutely they feel they are lacking the skills needed to use it effectively.
Only 17% of UK business leaders agree that their workforce has strong AI skillsets, yet 84% expect AI skills to be essential in the next five years. This disparity means that many companies are willing to pay a premium for AI talent, with the average company offering a 41% salary increase.
For job seekers, that premium could be worth an extra £16,000 a year.
Even with such incentives, it now takes UK businesses between 5.5 and 8 months to fill a digital role, with 52% struggling to recruit the necessary digital skills, the fastest growing challenge of the research.
AWS said that if left unchecked, the AI skills gap would be the biggest obstacle to the UK’s ability to turn widespread adoption of AI into real transformation.
Recommended reading
“AI is at a pivotal moment in the UK,” said Alison Kay, vice president and managing director at AWS UKI.
“Organizations across the country are seeing tangible results from AI, from increased productivity to faster innovation. While this progress is encouraging, there is still much to unravel, especially as we move from basic to advanced adoption of AI.”
The report identifies three priorities for the year ahead, including a greater focus on closing skills gaps through training, public-private partnerships, and investments in AI literacy.
AWS also said that more attention should be paid to helping businesses transform by introducing targeted strategies and programs in key areas such as cloud capabilities, and that governments should lead by example and expand AI across public services.
