AI offers chance for Industrial Strategy success – but skills gap and energy costs pose challenges

Published in June this year, the Modern Industrial Strategy sets out the UK government’s vision for AI. “The superstar firms of 2035 will leverage AI,” the document says. “The government is preparing for the prospect of transformative AI: business must do too.”

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Making the most of its potential could be easier said than done, however. UK manufacturing persistently lags behind the global competition on digitalisation, a key enabler for AI deployment, while other sectors face their own challenges.

“There’s a whole systems issue,” says IMechE education and skills policy lead Lydia Amarquaye, referring to aspects such as the high cost of electricity. “Some companies are not considering using the UK as a main manufacturing centre, and therefore the skill system isn’t churning to bring the skills that are required because investment is low.”

AI could nonetheless play a big part in the Industrial Strategy’s research and development goals, she adds, depending on sufficient investment. 

Advanced materials and battery development is likely to be dominated by generative AI, says the Alan Turing Institute’s Professor Adam Sobey. 

He adds: “AI research can help to improve the effectiveness of robotics/automation and reduce energy costs. Management of large supply chains is already being shown to be an effective use of AI. We are also extremely strong in design, an area where we have been able to extract value even if we don’t manufacture the final products, and more investment should probably be made by government to explicitly support smart design. This is an area where AI has already seen success.”

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