Artificial intelligence is on the rise worldwide, and London is no exception. Lily Clark examines how the capital’s relationship with AI is growing.

The rapid development of AI, and in particular generative AI (AI that can produce content at the prompt of the person using it) tools such as Chat GPT, have sparked a lot of recent conversation about what their impacts could be for Londoners.

London is the leading European city for AI:

• A 2021 survey by the government’s Digital Catapult identified the UK as the third most important centre for AI after the USA and China
• More than 70% of UK AI firms are based in London.
• London is the UK hub for many of the sectors which are most heavily utilising AI such as financial services, information and communications, healthcare and transportation.

Any societal changes brought about by AI are therefore likely to be felt in London. But what will these changes be? Will AI really put Londoners out of jobs? Or is there an opportunity presented to boost economic growth and productivity?

The answers are complex, but there are clear benefits through increased investment and efficiency. By mitigating the risks posed to jobs and security with proper regulation, London will continue to thrive as a hub for AI.

What are the advantages of AI growth in London?

London has become the European capital for AI for various reasons – it has a thriving tech ecosystem, has been at the forefront of AI research, and the Mayor has made a commitment to continue to invest in AI by integrating AI technologies into a wide range of areas to improve how London operates.

Investment

The advantage of so many AI companies choosing to locate in London is that it brings investment. AI is likely to create a supply of, and demand for, new products and services which London will be at the forefront of. Open AI, the developer of ChatGPT, recently announced that London will be the location of their first international office with a focus on research and engineering. A handful of jobs for the London office have already been posted.

Productivity

AI technologies can also help boost productivity within organisations, helping with time-consuming and repetitive tasks. For example, in financial services AI technologies can analyse market trends and the stock market, detect fraud, and provide customer services.

Savanta released recent research on how businesses use ChatGPT in the UK and ‘saving time/improved time management’ was cited as the top reason for usage (50%). Furthermore, a recent study found that AI-enabled workers took an average of a third less time to complete certain standardised tasks. They expressed more job satisfaction, spent more time coming up with ideas, and less time drafting them.

Innovation

The integration of AI technologies has the potential to bring societal benefits – we can already see this in healthcare where AI is being used for medical imagining, diagnostics, personalised treatments, and administrative processes. And this hasn’t taken away the need for real doctors and nurses.

What are the risks?

Job cuts

The main concern is surrounding the loss of jobs. The government’s chief scientific adviser recently stated that generative AI could be as transformative as the Industrial Revolution and that government needs to get ahead of it before large numbers of Britons become jobless.

AI undoubtedly has the potential to replace certain types of jobs. There are jobs in tech, finance, transport, journalism and advertising which AI technologies are already imitating. All of these industries are heavily based in London. There is the risk that companies will increasingly try to cut costs by utilising AI to undertake more and more business functions.

Devalued industries

A sector in which the future has become more uncertain for due to AI developments is the creative industries. Already, AI tools are being used in graphic design, advertising, and data analysis.  Image-generating AI in particular has the ability to transform advertising, gaming and filmmaking. AI can now also compose an original piece of music based on a specific genre or artist.

Misinformation

Other risks posed by the increased use of generative AI are surrounding security, ethics, plagiarism, and language bias. In Deloitte’s analysis of ChatGPT, they concluded that responses are not always accurate and reliable, and that the tool can replicate representative biases from the sources that answers are based off. We are a long way off being able to solely rely on generative AI as an accurate source of information and it should be used with caution.

Whilst ethnical concerns are valid, London has been investing in world-leading AI ethics expertise and The Mayor has committed to putting ethics at the core of London’s AI supplier base to provide a competitive advantage for London and the UK.

Generative AI needs to be governed properly if organisations are going to use it safely and confidently for core business functions.

Conclusions

Whilst the AI industry is booming and generative AI technologies are increasingly being utilised by London firms to save time and increase efficiency, we are not yet seeing large scale lay-offs. This is likely because generative AI lacks critical thinking and decision-making skills which humans provide, and because of the risks of surround accuracy and biases.

Currently it seems that businesses are using AI for efficiency and to boost productivity of employees, rather than to replace them – larger businesses are increasingly encouraging staff to use ChatGPT for these reasons.

London’s AI future is still unknown, but with proper governance and regulation, it could bring great benefits to Londoners, create jobs within the sector, and boost productivity.

If you’re interested in working with us to explore this topic further, get in touch with us at partnerships@centreforlondon.org.