October 21, 2024

UK Has Potential to Nearly Double Economic Growth During the Next 15 Years from Gen AI, Accenture Research Finds

Yet, up to £485 billion could be left untapped without decisive intervention from government and business on reskilling
Clear call to action for business to lead the way on gen AI to unlock UK productivity

LONDON: Oct. 21, 2024 – The UK could gain more from generative AI (gen AI) than any other G7 nation, provided measures are taken now to capitalise on the opportunity, new research from Accenture has found.

The technology could almost double the UK’s long-term growth rate from average annual growth of 1.6% to 3%, while adding up to £736 billion to annual GDP by 2038, an additional 23% over baseline GDP forecasts. This is a more substantial economic boost than any of the other 22 countries analysed. By comparison, GDP in the US is forecast to increase by 18%.

Additionally, gen AI could offer a credible antidote to the nation’s historic productivity gap, with a potential double-digit uplift available across the private and public sectors - if the roll-out of the technology continues to accelerate and harnesses a ‘people-centric’ approach. Investing in people is crucial to achieve this, with surveyed business leaders anticipating that 62% of the workforce, equivalent to 20 million people in the UK, will need to be reskilled to take advantage of changes caused by gen AI.

If these productivity benefits are translated into cost savings, the gains could be substantial. Across all industries analysed, total annual savings could reach nearly £167 billion if the full potential of the technology is realised.

Decisive intervention will be required

To realise the growth opportunity of gen AI, its roll-out will need to be undertaken responsibly. The greatest value of gen AI comes from a people-centric approach that automates routine tasks, preserves workers’ time for tasks that require a crucial human touch, while empowering workers to innovate and identify new opportunities.

Without decisive action from government and business leaders, up to £485 billion in economic value could be left untapped - an amount equivalent to double the UK’s annual healthcare spending - highlighting its significant potential.

Accenture identified three factors which pose a risk to the realisation of that potential, but which can be overcome with the right steps taken:

Deployment gap: In 2024, gen AI is expected to account for 10% of technology spend, rising to 15% in 2025, according to the business leaders surveyed. Yet, that investment has yet to translate into scaled deployment, enabling companies to realize the full benefits of generative AI.
Skills gap: Despite the significant impact leaders expect gen AI to have on skills, less than half (45%) report that their organisations have increased training in using gen AI in the past year. Investing in upskilling the UK’s workforce will have the dual benefit of plugging the skills gap while increasing productivity.
Trust gap: Trust that government (27%) or business leaders (33%) will make the right decisions to ensure gen AI has a positive impact on the UK continues to lag, but there is a clear opportunity to close that gap. By ensuring gen AI is deployed responsibly and bringing the UK’s workforce on the journey through investment in upskilling, government and businesses have a vast opportunity to build trust and understanding about the potential gains.

While there are clear challenges, there is cause for optimism. Early signals suggest an understanding amongst business leaders about the benefits of investing in, and implementing, gen AI. Over two thirds (67%) anticipate an improvement in national productivity, while over half believe it will drive economic growth (60%) and digital inclusivity (51%) across the UK.

Shaheen Sayed, Head of Accenture in the UK, Ireland & Africa, said: “There is an enormous opportunity to address longstanding productivity stagnation in the UK through an ambitious roll out of generative AI, but organisations already risk falling behind with a short-term view of the power of this technology. Unlocking growth from gen AI will require decisive action from business, policymakers and government, to upskill the workforce, empower people to drive new ideas and business models, and ensure the responsible application of AI across entire value chains. Technology alone won’t transform the economy and drive growth, it’ll come from the hands of the people that you put it in.”

Call to action for business to lead the way on gen AI

To reap the benefits from gen AI, Accenture has identified five clear steps business leaders and governments must take:

Lead with value: Shift the focus from siloed use of gen AI to integration across the entire value chain and developing new, AI-enabled offerings.
Understand and develop an AI-enabled, secure digital core: Invest in technology that runs seamlessly and allows for continuous creation of new capabilities.
Reinvent talent and ways of working: Set and guide a vision for how to reinvent work, reshape the workforce and prepare workers for a gen AI world.
Close the gap on responsible AI: Design, deploy and use AI to drive value while mitigating risks.
Drive continuous reinvention: Make the ability to change a core competency and part of company culture supported by an ecosystem of collaborators.

Sayed added, “Generative AI is not a one-off leap. It is a technology that holds the potential to fundamentally change the fabric of our economy and society. For businesses, this means getting multiple decisions right at the same time and overturning a stubborn skills shortage. There is a clear formula for progress which means the transformational power of gen AI in the UK economy could be well within reach – but only if businesses act now.”

Accenture recently launched an initiative – Regenerative AI - to help tackle the digital inclusion gap by enabling over a million people in the UK to get access to devices, data, and AI literacy courses.

Methodology

The research was conducted by Accenture using three research methods:

Economic modelling to forecast the potential impact of gen AI on productivity and growth for the economy, organisations and people. Accenture mapped out the future growth trajectories under three different AI deployment scenarios: aggressive, cautious and our proposed people-centric approach.
Surveys conducted with 3,752 employees and 1,085 executives from public and private sector organisations in the UK. The samples covered 19 industries and included different demographic groups by geography, company size and socioeconomic background. The surveys were conducted in July and August 2024.
Interviews, case studies and experience delivering 1000+ gen AI projects globally with leaders from large technology providers, industry, government and civil society.

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Contact:

Caroline Douglas

Accenture

+353 (0) 87 680 0074

caroline.douglas@accenture.com

Natalie de Freitas

Accenture

+44 7380 799 196

natalie.de.freitas@accenture.com