For six weeks, the conversation about artificial intelligence took a pause for breath. At no point during the general election campaign — from TV debates to stump speeches — was AI a talking point.
Never has the gap between politics and the boardroom been wider. Tune in to an earnings call, pick up an annual report, or open LinkedIn, and you would imagine there was little else to discuss.
But do not mistake the absence of debate with a lack of importance. Lurking beneath the surface of the manifesto, AI will be at the heart of Labour’s plans to restore public services, extend opportunity, and achieve the goal of becoming the fastest-growing economy in the G7.
To make it happen, the nation that once led the industrial revolution must now adapt its workforce for the AI revolution. Microsoft estimates that AI could potentially contribute up to £550 billion to the UK economy by 2035. Open Philanthropy, the research and grantmaking foundation, suggests AI could drive a surge in economic growth to 20 to 30 per cent per year this century.
For Britain to capture its share of these gains, we need a highly skilled workforce capable of creating, building upon, and using new technologies. This doesn’t mean turning everyone into machine-learning engineers, building the next models. But it does mean equipping the workforce with the ability to find application and value from AI tools.
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We must begin by changing employer attitudes that continue to place greater faith in recruiting external talent than in training existing employees. Currently, corporate spending on software outpaces investment in training by a factor of four. Bosses are investing in new tools without simultaneously investing in the brainpower to use them effectively. Anything that incentivises re-skilling alongside technological adoption will be essential to unlocking AI’s potential.
We also need a fresh government approach that incentivises investment in flexible, structured, continuing re-skilling programmes that enable workers to keep pace with technological change. Central to this solution is Labour’s plan to replace the apprenticeship levy, make it more flexible and morph it into a “growth and skills levy”.
Bridget Phillipson, the new education secretary, begins her role with certain advantages. The levy, a tax which effectively ringfences 0.5 per cent of a large employer’s wage bill for spending on skills, is forecast to raise an additional £1 billion a year by the end of this parliament. Meanwhile, the apprenticeships it funds are becoming increasingly effective: average additional earnings per apprenticeship have increased 44 per cent in the last decade. In stark contrast, the graduate premium has fallen.
This has not happened by accident. It is the consequence of a levy policy that enables employers to choose from a controlled list of regulated, quality programmes that best enable them to grow. Labour’s promise of reform should build upon these strengths and keep employers, and the jobs they create, at the heart of the system.
At the moment, too few firms spend their levy contributions. Reform must start with a more flexible array of qualifications eligible for funding. Modelling from Public First, the policy research agency, underscores the scale of the opportunity. If employers were able to flexibly invest a proportion of their levy contributions into just one additional form of training — higher technical qualifications — the UK could unlock a staggering £8 billion in economic gains, including in AI-related fields.
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The guiding principle in deciding which qualifications can be funded by a new growth and skills levy must be evidence of economic return. That means preserving what is unique about an apprenticeship: training that happens alongside a job. When skills are tested through immediate application in the workplace they are more likely to be retained. Speculative training delivered before someone is employed is markedly less effective.
Other flexibilities will make investments in training more attractive to employers. At present, courses must last a minimum of a year — a requirement that feels increasingly arbitrary given advances made in the delivery of training.
This is not to say there are no trade-offs. Experts have raised concerns that enabling firms to spend money allocated to apprenticeships on other forms of training might result in further falls in the number of apprenticeships, especially for younger adults.
The answer is to press ahead with further reforms to apprenticeships themselves. At Multiverse, AI means we can now tailor training to the individual needs of different learners. More flexible rules would allow apprenticeships to be delivered at the pace at which individuals learn, focus on the topics businesses most value, and keep content up to date, even as AI rapidly changes the skills employees need.
Britain starts with strong foundations: the thriving AI hubs of London, Cambridge and Oxford; a growing number of homegrown AI companies; and some of the world’s best research institutions. The missing piece of this puzzle: a culture of upskilling workers wherever they are in their careers.
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Now that the election is over it’s time to close the conversation gap. It is up to the government, businesses, and employees alike to seize this opportunity and get us ready for the age of AI.
Euan Blair is the founder and chief executive of Multiverse, a workplace training provider
