AI-linked sectors lift UK growth

Britain’s economy is showing clearer signs of gains from the global AI boom, as information and communications became the largest contributor to recent growth. The Office for National Statistics said the economy grew by 0.4% in the second quarter, with the sector accounting for almost half of the expansion.

Within information and communications, output from computer programming, consultancy and related activities, a category that would include AI companies, rose by 3.7% on the quarter after a 3.8% increase in the previous quarter. Since becoming prime minister in July, Andy Burnham has made AI a Cabinet-level priority, with a shift toward British ownership, tech sovereignty and worker protection.

Investment data also suggested AI-related momentum. Spending on plant and machinery rose to £22.1 billion ($29.8 billion) in the second quarter, close to a one-off record high in early 2022 linked to tax-break timing. An ONS spokesperson cited ICT equipment, especially computer hardware, along with government spending on weapons systems.

Manufacturers are benefiting as well. Output among British computing, electronic and optical product makers grew by 10.7% in annual terms in the second quarter, ranking first among the 13 manufacturing sub-sectors for the first time since early 2017.