Government turns to skills to tackle low AI adoption among SMEs

The UK government’s expansion of free AI foundations training is being framed as a response to persistently low levels of AI adoption across British businesses, particularly among small and micro enterprises.

While AI tools are widely available, government research cited alongside the announcement suggests that only around one in six UK businesses were using AI as of mid-2025. Adoption rates are significantly lower among smaller firms, with micro businesses far less likely to deploy AI tools than large organisations.

From a business perspective, the problem is increasingly being described less as access to technology and more as confidence and capability. Only a minority of workers report feeling confident using AI at work, a gap that appears to be more pronounced in smaller organisations with limited in-house expertise and fewer resources for structured training.

The government’s approach is to lower those barriers by offering short, practical AI foundations courses free to every adult, with particular emphasis on reaching employees in small and medium-sized enterprises. At least two million SME workers are included in the target to upskill 10 million people by 2030.

Business groups including the Federation of Small Businesses, British Chambers of Commerce and the Institute of Directors have joined the partnership, reflecting concern among employers that uneven AI adoption risks widening productivity gaps between firms.

For many SMEs, the challenge is not identifying use cases, but feeling confident enough to act on them. Smaller businesses are less likely to have dedicated IT or data teams, and often rely on generalist staff to evaluate and adopt new tools alongside day-to-day responsibilities. In that context, even basic guidance on safe and effective use can make a material difference.

The design of the AI foundations training reflects this focus. Courses are intended to be completed quickly, in some cases in under 20 minutes, and concentrate on everyday tasks such as drafting text, creating content and handling administrative work. The aim is to demystify AI use rather than encourage complex deployment.

Alongside the training offer, the government has announced £27 million in funding for a TechLocal scheme to support tech jobs and training in local communities. While not limited to AI, the scheme is positioned as part of a wider effort to ensure that smaller firms and regional economies are not left behind as adoption accelerates.

The involvement of large employers and technology providers in delivery underlines the scale of the ambition, but the success of the programme is likely to be judged by uptake among smaller businesses. Previous waves of digital adoption have tended to favour organisations with greater capacity to invest, leaving long tails of lower productivity among SMEs.

By focusing on skills as a first step, ministers appear to be betting that confidence and basic competence will unlock wider use of AI tools across the economy. Whether that proves sufficient will depend on how far training translates into sustained change in how smaller firms work.

What is clear is that AI adoption is being treated less as a technology choice and more as a workforce issue, with skills positioned as a prerequisite for productivity rather than an optional extra.

Key facts

• Only 1 in 6 UK businesses were using AI tools as of mid-2025.
• Micro businesses are 45% less likely to adopt AI than large organisations.
• At least 2 million SME employees are included in the government’s target to upskill 10 million workers by 2030.
• Only 21% of UK workers say they feel confident using AI at work.
• Free AI foundations training is open to every UK adult, with some courses designed to take under 20 minutes.

More on the UK Government’s AI training announcement

Government expands AI training to reach 10 million UK workers
Government-backed AI benchmarks raise new questions for corporate learning