AI boom helps drive surprise UK growth in July

Image source, Getty ImagesByEmer MoreauBusiness reporterPublished11 September 2026, 07:13 BSTUpdated 1 hour agoThe UK's economy grew faster than expected in July partly helped by businesses using artificial intelligence (AI).

The economy expanded by 0.4%, the Office for National Statistics (ONS) said, whereas analysts had predicted no growth.

Growth in July was helped by a strong performance from the services sector, and particularly computer programming.

Experts said the figure showed the UK economy was proving resilient in the face of shocks such as the war in Iran, but they expect growth to slow in the months ahead as high energy prices affect households.

According to the ONS director of economic statistics, Liz McKeown, there was evidence that businesses involved with AI and related technologies helped to boost the sector, not just in July but in May and June as well.

The ONS said many of the IT businesses reporting the largest turnover "appear to be involved with AI", though it said it is difficult to quantify the exact impact of AI.

McKeown also said some businesses had said that the warm weather and football world cup had affected activity in July, although she said the effects "differed across industries, benefitting some businesses while creating challenges for others".

The ONS said that in the three months to July, which gives a better underlying picture, the economy grew by 0.4% compared with the previous three months.

Rob Arnold, co-founder of Ascendea, an AI firm which employs nine people, believes the UK hasn't seen the real economic growth potential from the technology yet.

He says his company is able to develop apps for other businesses "100 times quicker at a 50th of the cost" because of AI, but that the UK government needs to do more to invest in the sector as there are currently better opportunities in the US.

He knows a few small UK-based AI firms that have either moved to the US or are thinking of doing so due to a lack of UK government support.

Alongside grants and funding, he says the government also needs to invest in training companies on how to use AI as it can be dangerous if not understood properly. "It's like playing with a weapon," he says.