UK businesses are turning to artificial intelligence (AI) as a key strategy to address business challenges amid economic and energy pressures, according to the latest Barclays Business Prosperity Index. The report, which analyzed data from over one million Barclays clients and surveyed 1,000 business leaders, found that 89 percent of UK firms plan to use AI in the next two years. Their main goals include improving data analysis, forecasting, customer experience, and reducing operational costs.
Over the past year, businesses invested an average of £235,600 in AI and emerging technologies. Larger corporates with more than 250 employees spent around £400,000 on average, while medium-sized enterprises invested about £225,500 and small businesses allocated roughly £125,250. Looking ahead, 68 percent of firms expect to increase their investment in these areas over the next year.
In addition to AI spending, companies intend to boost overall investment by 5.5 percent in the coming year. The primary areas for this increased spending are staff training and development (42 percent), improved digital products (37 percent), and research and development (37 percent).
The report highlights a significant skills gap: 39 percent of business leaders cited AI and digital technology skills as the most lacking within the UK workforce. This shortage is particularly pronounced in financial services (52 percent), IT & telecoms (48 percent), and the tech sector itself (51 percent). In response, nearly a third of businesses have already hired or are currently hiring for AI-focused roles; 42 percent plan to do so.
The survey also found strong confidence among business leaders: "It’s encouraging to see an intent to invest from UK businesses, with many turning that into action. Against a backdrop of global uncertainty, there’s more to do to build confidence in the UK as a place for businesses to grow and scale," said Matt Hammerstein, Chief Executive of Barclays UK Corporate Banking.
Businesses using AI reported several benefits: 32 percent saw improved idea generation and innovation; 31 percent noted better decision-making; 30 percent experienced enhanced customer service; another 30 percent reduced operational costs. A majority—72 percent—of business leaders believe the UK could become a global leader in AI innovation.
However, despite this optimism for technological advancement, many firms remain cautious due to economic uncertainty. Over half (55 percent) are delaying investment decisions until after the Government’s Autumn Budget announcement; yet more than two in five expect to increase investment once new measures are revealed.
Barclays’ anonymized client data comparing Q2 2024 with Q2 2025 shows cash inflows fell by 0.8% year-on-year while current account balances dropped slightly by 0.4%. Businesses increased overdraft usage by 3.3%, but lending remained subdued—down nearly six percent on average per firm—despite borrowing £9 billion from Barclays' Business Prosperity Fund during H1 2025.
Of those not borrowing recently for investment purposes (75%), reasons included high interest rates (31%), economic uncertainty (27%), or waiting for greater stability before taking on new debt.
Energy costs remain another challenge: among firms affected by rising prices (84%), nearly two out of five had to adjust budgets accordingly. Some responded by investing in energy efficiency upgrades or switching to renewable sources.
"Despite economic and energy challenges, UK businesses are pushing ahead with AI and skills investment to unlock productivity and growth. Firms are showing resilience by adapting quickly to new technologies and equipping their people with the tools they need to thrive," said Abdul Qureshi, Managing Director of Barclays Business Banking.
The Barclays Business Prosperity Fund offers lending options for both new and existing customers aiming at supporting growth initiatives across various sectors.
For further information about Barclays’ approach or details on their ongoing research methodology—including weighting data by company size and sector—visit home.barclays/businessprosperity.