Ross DeVol
Chairman Emeritus and Distinguished Fellow

A global race is underway to determine which countries will be at the technological frontier in developing and deploying artificial intelligence (AI). The US made great strides in advancing generative AI over the past decade with innovators such as OpenAI, Anthropic and Databricks propelling it ahead. However, DeepSeek was developed in China at a lower cost and appears to have similar performance metrics as the best American AI tools.

Many national security experts believe it is critical for the US to out-innovate and quickly adopt AI or risk having our security compromised by unconstrained, AI-enabled government and non-government actors in China and elsewhere. Further, it has been agreed US economic competitiveness would be undermined without AI adoption by slower advances in productivity, harming our economic prospects in the long term.

As this global AI race progresses, another contest is underway within the U.S. as to where the leading geographic centers of AI excellence will be located. Nascent technologies tend to cluster in locations with the ability to create, deploy and exploit them for economic competitiveness. It is essential that heartland communities establish themselves as national leaders on AI excellence and innovation or the region risks slipping behind over the long term. Those communities that develop their AI capabilities in talent, innovation and adoption are best poised to leverage it for economic growth both in the short and long-term.

In the early stages of AI, it is important to understand how heartland metropolitan economies are positioned based upon their current capacities. Fortunately, Muro and Methkupally, from Brookings Metro have developed a benchmarking tool to assess how metropolitan areas rank based on 14 metrics that measure AI talent, innovation and adoption. The authors conclude that San Francisco and San Jose are the two current “superstar” metro areas for AI due to their unmatched strength across all three categories. While AI capabilities are still highly geographically concentrated, there is evidence that some dispersion is occurring.

Chicago ranks first among heartland metros on its readiness to leverage AI for economic development purposes. AI activity in Chicago encapsulates a growing ecosystem of academic research institutions, established firms and startups focused on creating and implementing AI across many sectors. Chicago is becoming a hub for quantum computing, and when combined with formidable strengths in finance, logistics, health care and manufacturing, there is a solid foundation to build upon for future leadership in AI innovation.

AI Capacity Levels in the Chicago-Naperville-Elgin, IL-IN Metro Area

The Chicago metro area has a huge AI talent pool as can be seen in Table 1. Chicago has 637,500 graduates with bachelor’s degrees in computer science, engineering and mathematics. By comparison, the San Francisco metro area has only 16,600 in this category. This attests to the size of the business and professional services located in the Chicago area, allowing them to attract and leverage top talent. Chicago is well-endowed with PhDs in computer science, engineering and mathematics at nearly 3,000. By comparison, the San Jose metro area has just over 2,000 in this category. Prominent AI-focused institutions include the University of Chicago, the University of Illinois, Chicago, Northwestern University and the Illinois Institute of Technology—all of which contribute to the strength of Chicago’s talent pool.

For this and other reasons, the Chicago region was named an official U.S. Regional and Innovation Technology Hub for quantum technologies by the US Department of Commerce’s Economic Development Agency. This is a designation that opens the door to federal funding and recognizes the growing strength of an ecosystem poised to become a national leader in the quantum economy, providing support for leading-edge applications in AI. As such, AI-innovation assets are numerous in Chicago. The University of Chicago’s (UC) Computer Science department is prolific in AI applications in health care, climate, graphics and computer vision. UC’s Pritzker Molecular Engineering Institute leverages AI to accelerate progress in cancer treatments, drug delivery and renewable energy. The Eric and Wendy Schmidt AI in Science Fellowship is a program that trains scholars to integrate AI methods into their natural sciences research. Argonne National Laboratory boasts one of the fastest computers in the world for AI performance.

Additionally, regional universities are conducting applied AI research, such as Northwestern, which focuses on robotics, human-computer interaction and data science and the University of Illinois, Chicago, which has the AI.Health4All Center focusing on machine learning for health care. Given the level of AI related work conducted at Chicago-area schools and affiliated laboratories, it is unsurprising that the Chicago metro area has recently presented 136 papers at top AI conferences and has had over 1,100 AI patents granted.

While Chicago excels in AI talent, its adoption metrics are additionally impressive, ranking favorably alongside, although still somewhat lower than, the two superstars of San Francisco and San Jose. For example, in a recent analysis, Chicago had 18,900 job postings requiring AI skills while San Jose had 29,800. Chicago scores well on most other adoption metrics such as percentage of firms adopting AI technologies and firms adopting cloud-based tech. The local share of jobs exposed to generative AI was at 34%, placing it among the highest nationally.

Examples of AI adoption and application by the Chicago private sector are illustrated by Tempus—a firm that uses AI and a large library of clinical and molecular data to advance precision medicine; Uptake, which specializes in translating data for smarter operations for logistic and supply chain optimizations; and XSELL Technologies, which developed a platform to improve sales and service agent effectiveness through personalized customer engagement.

Moreover, Chicago has launched 373 startups and closed 227 venture capital deals pertaining to AI in recent years. While on the surface these numbers seem impressive, they are substantially lower than those reported by superstar metros. Leading AI venture capital firms in the Chicago area include Lightbank, Tensility Ventures and MATH Venture Partners—all of which work to deploy capital to the region with a particular eye toward artificial intelligence.

As a final testament to the AI focus of Chicago, the city hosts a yearly “Chicago AI Week,” which brings together researchers, investors, founders and experts focused on AI applications across industry while providing vital networking opportunities, which interconnect the AI assets of the Chicago region all with the goal of expanding industry and building on regional economic success.