Report: UK manufacturing can benefit from AI

The Make UK and Autodesk report highlights growing investment in artificial intelligence (AI) among British manufacturers, with three-quarters planning to increase their investment.
There are, however, significant barriers to smaller firms fully leveraging AI's potential, resulting in uneven adoption.

Identifying areas where government policy and industry action could facilitate broader adoption of AI, Future Factories powered by AI explores the opportunities AI provides to the manufacturing sector. However, AI has yet to be fully integrated into core manufacturing processes, despite its benefits in energy optimisation, waste reduction, and resource efficiency.

As key benefits of AI, manufacturers cited increased efficiency (69%), increased productivity (61%), and automated routine tasks (46%). While large companies are twice as likely to implement AI as SMEs (71% vs. 28%), small companies are missing out on these advantages. Inequalities in access to digital infrastructure, technical skills, and awareness contribute to this disparity.

Nina Gryf, Digitalisation Lead at Make UK, commented: “AI and automation are driving dramatic change in speeding up manufacturing processes and elsewhere in companies. Their potential to drive economic growth and reshape industries is becoming clear. However, while the uptake of such technologies is increasing, the UK needs a step change in automation; otherwise, it risks missing out on vital transformative productivity gains.”

Additionally, the report highlights the UK's slow adoption of robotics. Among comparable nations like France and Italy, the UK ranks 24th in robotics use, with just 111 robots per 10,000 employees. Furthermore, 29% of manufacturers have no plans to explore robotics, while 16% already use it.

Knowledge and Skills Challenge

Many companies, particularly SMEs, aren't reaping the benefits of AI due to a lack of knowledge and skills, the report reveals. As a result of AI adoption, nearly a quarter of firms reported increased profits, and a third said they were able to take on more jobs, demonstrating the technology's transformational potential.

Srinath Jonnalagadda, VP of Industry Strategy for Design & Manufacturing at Autodesk, stressed the need for long-term commitment: “Taking advantage of new technologies isn’t a one-off investment and the silver bullet for change. It demands a shift in mindset and an iterative approach over time. A continued and concerted effort will be needed to achieve industry transformation and workforce with the skills and capacity required to take advantage of new technology. This will enable UK industry to emerge as a global leader in AI-driven innovation.”

Manufacturers, particularly small firms, need targeted support, according to the report. In addition to extending R&D tax relief to capital equipment investments, the Made Smarter programme should be expanded to cover support across the country. Peer-to-peer learning is also encouraged among industry leaders to address cultural and awareness gaps.

August 2024 was the date of the survey of 151 companies.