New AI Sector Report by the Department for Science, Innovation and Technology (DSIT).
This week the UK Government published the latest Artificial Intelligence Sector Study, the main source of data and evidence on the UK’s AI sector for the Department for Science, Innovation and Technology (DSIT).
For the second consecutive year, our AI research capability was used to collect the key data and insights for the study. We are proud to have collaborated with Perspective Economics, Ipsos and Beauhurst.
The latest data shows there are more than 3,700 AI companies in the UK, generating more than £10 billion in revenues, employing more than 60,000 people in AI-related roles, and contributing £5.8 billion in Gross Value Added (GVA).
We discovered a 17% increase in the number of AI companies operating in the UK, with AI-related revenues increasing by over a third in one year (34%), and a big 57% spike in AI-related GVA.
Given that Standard Industrial Classification (SIC) codes do not include a specific ‘artificial intelligence’ classification, the analysis was based on a business-focussed taxonomy that can better reflect AI activity:
Through a combination of AI-driven web intelligence provided by Glass.AI and a collation of company data from numerous open and proprietary sources, the study showed there are currently 3,713 active UK companies providing AI products and services. 96% of the companies identified are SMEs (small and medium-sized enterprises). Also, we uncovered that 59% are dedicated AI businesses and 41% are diversified (i.e., have AI activity as part of a broader diversified product or service offer).
In terms of locations, the concentration of AI companies in the UK remains heavily skewed towards London, the South East, and the East of England, accounting for 75% of registered office locations and 74% of trading locations. However, there is growing AI activity outside these areas, with Scotland and the North West jointly holding the fourth-largest share of AI companies in 2023.
US companies play a significant role in the UK AI sector. As well as accounting for over half of all 316 internationally headquartered companies, US firms account for more than three-quarters of all AI-related employment, revenue and GVA generated by international companies.
Our AI capability was also used to uncover employment figures by crawling the websites of the companies, Companies House and other sources like LinkedIn. In 2022, a total of 50,040 Full-Time Equivalents (FTEs) were employed across both dedicated and diversified AI companies. In 2023, total AI-related employment has increased by ~29% to 64,539 (+14,499). Approximately 47% of employment is within dedicated AI companies and 53% is within diversified companies (n=30,247 and 34,292 respectively).
Despite accounting for only 9% of all AI companies with activities in the UK, internationally headquartered firms account for 47% of AI-related revenues and 33% of AI employment. This suggests international companies play an outsized role in the UK’s AI sector. For example, Web intelligence generated by our AI emphasised the extent to which just a few prominent US providers dominate the AI infrastructure landscape.
The rich web data also showed that partnerships among leading dedicated AI companies point to a vibrant AI ecosystem — 27 of the largest dedicated AI companies have collaborated with ~130 partners spanning a range of organisations including academic institutions (e.g., Universities of Cambridge, Oxford, Bristol, Warwick, Essex and UCL), corporates (e.g., HSBC, Merk, Sanofi, Bristol Myers Squibb, Asda, Ocado, AIG, Bupa), government departments and other publicly funded organisations (e.g., the NHS, Transport for London and the BBC).
You can read the full published report here.
If you’re interested in researching a sector in the UK or globally, you can contact us at info@glass.ai.