The use of intelligent machines that can process information and adapt to make autonomous decisions in a similar manner to humans, is revolutionizing the way we work. This nascent data-driven technology is quickly becoming a central tenet across major sectors — especially fintech, health, and manufacturing, where it’s projected to increase labor productivity by up to 40% and create the “next generation” of jobs in the process. AI is therefore on the brink of inciting some disruptive changes and is already contributing to the “the fourth Industrial Revolution” — a shift forecast to be more transformative than any other industrial revolution we’ve seen before. With the application of AI algorithms in manufacturing, AI is able to optimize manufacturing supply chains, helping companies anticipate market changes and unplanned downtime as well as apply analytics to data to improve overall efficiency, product quality and the safety of employees.

Nowhere is better placed to take this on than the U.K. According to Oxford Insights, Britain is ranked 2^nd in the world for Government AI readiness, which isn’t so surprising given the huge investment the country’s AI sector has received. Possessing one of the biggest tech ecosystems in the world, the U.K. received just short of a billion pounds in investment from the government as part of its AI sector deal last year, with AI startups from the U.K. raising nearly as much capital as France, Germany, and the rest of western Europe combined. And if professional services giant PwC’s predictions are anything to go by, the technology will be one of the biggest commercial opportunities in the U.K.’s economy, driving growth in the GDP by 10% come 2030.

So why is the U.K. best placed for this exponential growth in AI? Experts believe investors are attracted to the country’s business-friendly, robust and forward-leaning regulatory climate, especially when it comes to data analytics. The U.K.’s Seed Enterprise Investment Scheme (SEIS) and Enterprise Investment Scheme (EIS) are a major pull too, due to the generous tax incentives they offer, encouraging seed investment in early-stage businesses. Both propose an income tax and capital gains tax relief to qualifying investors who subscribe for shares in qualifying companies, with the difference being that the SEIS is focused on very early-stage companies and offers a much higher Income Tax reduction of up to 50% of the amount invested.

Education is also a big factor at play. With some of the globe’s best universities, Britain boasts a pretty impressive roster of technology talent. Some of the world’s strongest university research groups in AI, such as Cambridge, Edinburgh, Oxford and UCL, can be found across the country and lie at the heart of the key U.K. AI clusters. Each has experience of nurturing successful AI start-ups, such as SwiftKey in Cambridge and Skyscanner in Edinburgh.

The capital, London, is home to some 5,000 active tech start-ups with a combined valuation of £34 billion. London is also a leading global financial hub and an AI hub and home to more AI start-ups than any other European country.

According to a recent report by TechNation, total Venture Capital investment in U.K. tech topped $10.1 billion in 2019 — more than any other European country, and up 44% compared to 2018.

One of the most successful businesses to come out of the U.K. is DeepMind Technologies, an AI company recognized for its life-changing tech. Bought by Alphabet in 2014, DeepMind has since developed an AI-powered system to autonomously manage cooling and energy efficiency of Google’s data centers. Its natural language recognition techniques are also powering Google Assistant — a tool used in consumer and commercial products by over 1 billion people.

In May 2018, the government announced the AI Sector Deal, a plan which not only established a government office for the tech, but provided a blueprint for how the country can continue to develop such innovations to retain global leadership. As part of the deal, the U.K. is investing £20 million in the application of AI in the services sector and an additional £93 million toward the R&D of automation and robotics for use in industries such as offshore and nuclear energy, space and deep mining.

Then, there’s the Department for International Trade (DIT), an international economic department in the U.K. government that helps local businesses export and grow into global markets and overseas companies locate and grow in the U.K. The body’s Director of Technology and Advanced Manufacturing, Oriel Petry, says the DIT is focused on putting technology and innovation such as AI at the heart of the U.K.’s global growth:

“The U.K. is extremely serious about AI, and the huge opportunities it can have for businesses; particularly the potential to reshape existing workforces to develop more data-driven skills and deploy talent that can engage with more automated ways of working.”

The country is also supporting the growth of the next generation of AI scientists and engineers, through vocational programs such as apprenticeships as well as at universities. The AI Sector Deal announced the creation of 200 new PhD places in U.K. universities every year for the next five years; 16 new Centers for Doctoral Training in AI and Turing International Fellowships to attract talent to the U.K.

If there’s one thing the British technology industry is known for, it’s the success of its financial technology, or fintech sector. Seeking to improve and automate the delivery and use of financial services, this industry is driving significant and wide-reaching innovation up and down the entire country, especially Edinburgh and Belfast. While Scotland’s thriving financial sector is the largest in the U.K. after London — managing £800 billion in assets funds — the Northern Ireland capital is ranked as the top destination for financial technology investment and the number one city in Europe for software development projects. Each are instrumental in putting the U.K. on the map when it comes to fintech: from opening up availability of smart banking platforms to new innovations shaking up the insurance and the crypto-asset space.

In 2019, the U.K. saw record levels of investment in the fintech sector. According to financial data firm PitchBook, a massive $2.11 billion (£1.63 billion) investment has placed London as second for global fintech investment by deal value — right behind New York City. This surpasses totals seen in any previous year.

Thanks to the fintech investment boom, a handful of U.K. start-ups have been able to achieve the £1 billion funding goal to make it to unicorn status. Take challenger bank Monzo, for instance. Founded just four years ago, the London-based firm has rocketed to success as a “bank for the people.” Last year, the start-up raised £85 million from U.S. venture capital investors, hitting a landmark valuation of over £1 billion. Quite astonishingly, it now touts more than 1 million users, counting for 15% of all newly-opened British bank accounts. While not strictly an AI company, such tech is at the center of Monzo’s operations, so much so that the firm recently hired a “Machine Learning Lead,” employed to build up its AI capability in the core areas of the business.

AI financial assistant startup, Plum, is also an example of a fintech start-up that has benefited from this surge in investment. This chatbot-based app acts like an accountant version of Alexa. It works by connecting to your bank account and automatically saving a personalized amount for you, based on your income and outgoings. Chatting with you via instant messages, it’ll offer smart suggestions of where you could save. Plum recently disclosed a further £3 million in funding, bringing the fintech startup’s total funding to £6 million in just over three years.

Another British fintech unicorn using AI at its core is OakNorth. Securing $576 million in funding to date, the U.K. digital-focused challenger bank was founded in 2015 and relies on an AI-powered platform it calls ACORN. This tech uses machine learning to drive data-driven decision-making across the lifecycle of loans to help automate banking services. It works by pulling in hundreds of data points on whatever industry the loan is to be applied in to analyze the credit risk.

So, what is it that makes the U.K. a great location for companies that want to innovate by applying artificial intelligence to financial services? And what makes the fintech sector more appealing for investment over other industries? According to Alessandro Tonchia, Co-founder and Head of Strategy at global fintech provider Finantix, it’s a convergence of factors. Firstly, there are strong and dynamic wealth management and banking industries that are tackling interesting business challenges, says Tonchia.

“This is helped by the availability of human talent that can approach such problems with a clear vision of the business impact that technical solutions need to generate,” he says — adding that the British academic community has historically been doing important work on AI, both from a theoretical and an applied point of view.

“The U.K. is a very fertile territory, not only for the presence of good universities for computational linguistics, but also because — given the cosmopolitan population — it is easy to find technically minded native speakers in the many languages that our semantic engine has to support.”

As the U.K. has become a true hub for technology-driven innovation in finance, there is every reason to expect it will only grow. Investment figures for the first six months of 2019 were certainly representative of this. Also, the combination of forward-thinking regulators, tech talent and a well-developed network of support for tech start-ups, too, have all helped lay the foundations for success.

Major AI applications, such as machine learning and deep neural networks, have spurred significant advances in health care, including diagnostics, robotic surgeries and virtual nursing assistants. Health care AI is therefore projected to reach $6.6 billion globally by 2021, according to Accenture, and could save the health care industry billions annually.

Recognizing this, the U.K. has launched a host of initiatives, one being NHSX, a joint unit set up by the government to inject innovation into health care. With some of the best talent in the industry, NHSX aims to “create the most advanced health and care service in the world” to diagnose diseases earlier, free up staff time and empower patients to take greater control of their health care. An “AI lab” will be at the center of this, addressing current issues such as efficiency and a lack of funding, it will automate tasks to reduce clinicians’ workloads and improve productivity, such as giving patients tools to access services directly.

Some hospitals in the U.K. are already using advanced research to improve their quality of care. Late last year, Great Ormond Street Hospital (GOSH), the largest center for child heart surgery in the U.K., partnered with University College London and industry experts in AI to set up a state-of-the-art unit called DRIVE, an abbreviation for “Digital, Research, Informatics and Virtual Environments.”

The unit works alongside tech behemoths including ARM, Microsoft, Samsung and others to create a unique informatics hub that looks to inject cutting-edge developments into clinical settings. Harnessing the power of these technologies, its goal is to “revolutionize clinical practice and enhance the patient experience,” not only for GOSH patients but across the wider NHS. One such way is with system integration company NTT DATA, which will be using AI and data analytics to deliver safer and better (data driven) health care at a lower cost. The center has already been helping via a project named Fizzyo. This scheme aims to improve physiotherapy care for children with cystic fibrosis through electronically chipped airway clearance devices as well as wearables that can usher data transmission from their homes to the clinicians caring for them.

Researchers up and down the U.K. are working with AI to improve the health industry in the U.K. Director of Imperial College AHSC, Professor Jonathan Weber, says there are “tremendous opportunities” to develop and improve the delivery of care through AI. From redefining drug discoveries to helping to predict and prevent diseases using health record data, researchers are working together on ground-breaking AI research that is already changing lives and will have a transformative effect on both doctors and patients.

It was announced earlier this year that Wales will soon be home to a brand-new center geared toward the development of AI and robotics and built to position the country as a hub for emerging and innovative tech.

The £3.5 million center, will build on the research expertise at the university and focus on high-profile research projects on sectors of strategic importance for Wales. This includes a big focus on the societal challenges facing healthcare and assisted living.

Health care in the U.K. is certainly one of the most promising sectors for the integration of AI and each year demonstrates an encouraging increase in applications. A recent study conducted by Microsoft and YouGov found 46% of health care leaders in the U.K. reported their organization used the technology in some capacity, with the biggest growth areas reported as research-level AI, which grew 13% in the past 12 months. Robot automation also increased by 10%, while the use of voice recognition technology increased by 9%, making AI in health care one of the most potentially transformative yet life-saving sector advancements.

The U.K. is the birthplace of the first industrial revolution, and thanks to high-tech sectors such as aerospace, remains a leading manufacturing nation today. There are 2.6 million people directly employed in manufacturing in the country, contributing to product sales of £365 billion in 2016, according to the Office for National Statistics.

However, while high value manufacturing is a core component of the U.K. economy, manufacturers are constantly striving to improve quality while reducing costs and increasing productivity. This is especially evident in high integrity engineering sectors, where the need for support has placed a huge pressure on the delivery of reliable and high-quality evaluation methods, such as inspecting components and ensuring they are fit for function.

Because inspections are manual, the process involves a physical assessment of machinery to identify and prevent system failures and faults, which can be time-consuming and costly — especially for those working in the aerospace, automotive and construction sectors. Therefore, there’s a need to speed up the process to cope with growing demand for high quality machinery that stands the test of time. Innovate U.K., the U.K.’s Innovation Agency, has identified AI as the next breakthrough technology to combat this issue and driving better productivity for high value manufacturers.

At the forefront of this advancement is an initiative called  AI for industrial inspection (AI4II), which is set to transform the way manufacturers carry out the process of visual examination of high value components, using computer vision. The development of AI4II has already proved to be of use; delivering smarter and more efficient ways of working, as well as pushing down production costs, and paving the way for a solution to combat the challenges that valuable manufacturers are facing, digitally.

With expectations that 15.4 billion AI-powered devices will have been installed in industrial manufacturing by 2024, it is clear that it’s a phenomenon bound to take manufacturing by storm in the U.K. Some of these applications include programs that can predict failures in equipment before issues arise, allowing for predictive maintenance and reducing downtime, as well as enabling manufacturers to automate complicated tasks via signals in data that was previously too complex to take on. By providing robots with greater degrees of learning ability and sensitivity when it comes to touch, machines could easily lend a helping hand with assembly and movement-dependent activities on the manufacturing floor.

Take Japanese machine tool manufacturer Yamazaki Mazak, for example. Setting up a European technology center at its plant in Worcestershire, this international manufacturer is certainly making the most of a U.K. base to develop AI solutions. The firm’s innovations integrate AI, resulting in the development of smarter machine tools fit for the 21st century. Its Smooth AI CNC system, for instance, monitors machine spindles to not only ensure they operate at optimum level but reports potential impairment before extensive (and expensive) repair is required.

Recognizing that smart solutions play a vital role in the future of manufacturing, the University of Sheffield’s Advanced Manufacturing Research Center (AMRC) has set up a state-of-the-art test bed factory called Factory 2050. The factory engages in collaborative projects with major international companies, such as IBM and Rolls Royce, interested in developing new technology for machine and manufacturing processes. Currently, the AI solutions implemented by Factory 2050 include using AI to enhance interaction with factory shop floor operators as well as supporting natural and digital language processing.

These are just some of the factors that have led experts to believe a compliance with AI in the manufacturing space will accelerate us into the fourth industrial revolution. The first three industrial revolutions brought us mechanization, mass production and automation. Now — more than half a century after the first robots worked on production lines — AI is the next in line to shake things up.