Barclays Q1 2026 research shows London firms outperform national averages on optimism, technology investment, and cybersecurity spending
London businesses are demonstrating stronger confidence than the UK average despite ongoing geopolitical pressures, according to new research published by Barclays ahead of London Tech Week 2026.
The Barclays Business Prosperity Index, launched at the Barclays Innovation Hub in Shoreditch, surveyed firms across the UK and found London consistently outperforming national benchmarks across confidence, digital investment, and cybersecurity preparedness.
Business Confidence Remains Strong in London
While 80 percent of UK businesses report that the Middle East conflict has negatively affected their operations, London firms have maintained notably higher confidence levels than the national average.
Key findings from the index:
- 88 percent of London businesses are confident about their five-year prospects, compared to 80 percent nationally
- 68 percent of London firms are confident in the UK economy, versus 57 percent across the country
- 77 percent feel positive about the European economic outlook, against 65 percent nationally
- 67 percent express confidence in the global economy, compared to 57 percent UK-wide
This gap suggests London’s business ecosystem — supported by access to finance, international trade connections, and a diverse talent base — is providing firms with greater insulation against external economic pressures.
Cybersecurity Becomes a Boardroom Priority
As digital operations expand, cybersecurity has moved up the agenda for London businesses. The average cybersecurity spend among London firms so far in 2026 stands at nearly £640,000.
Despite this investment, confidence gaps remain. Only 35 percent of London businesses feel fully equipped to handle a major cyber incident, and 52 percent believe new technologies are actively increasing their exposure to cyber threats.
In response, 86 percent of London firms plan to increase cybersecurity budgets over the next 12 months — a figure that reflects growing boardroom awareness of digital risk rather than complacency.
The combination of rising AI adoption and expanding cloud infrastructure is widely considered to be driving this heightened focus on cyber resilience across the sector.
Seven in Ten London Firms Now Using Agentic AI
Artificial intelligence adoption in London has moved beyond experimentation. The index found that 71 percent of London businesses now use agentic AI — systems capable of completing multi-step tasks with limited human input — in some part of their operations.
The reported business benefits are measurable:
- 59 percent say AI and automation have improved overall productivity
- 41 percent report a reduction in administrative workload
- 36 percent say AI has accelerated decision-making processes
- 35 percent say staff can now focus on higher-value work as a result
Technology budgets for the coming year are concentrated across three areas: cloud infrastructure, cybersecurity, and artificial intelligence. This pattern reflects a broader shift among London businesses toward building long-term digital foundations rather than short-term cost reduction.
London Tech Week Context
The research was published to coincide with London Tech Week 2026, one of the largest technology events in Europe. The findings were presented at a panel discussion featuring Howard Dawber OBE, Deputy Mayor of London for Business and Growth, and Irene Graham, CEO of the ScaleUp Institute.
London’s position as a leading global technology hub continues to attract international investment and talent, factors that appear to be reinforcing business confidence even in uncertain conditions.
For further context on how London businesses are navigating economic pressures, see earlier reporting on London business confidence and AI-driven growth plans.
What This Means for UK Business
The Barclays data points to a divergence between London and the rest of the UK on technology readiness and economic outlook. While geopolitical uncertainty is affecting businesses nationally, London firms appear to be channeling that pressure into investment rather than caution.
The challenge ahead lies in translating confidence and technology adoption into sustainable growth — particularly for smaller firms that may face greater barriers to cybersecurity investment and AI implementation than larger enterprises.
