Insights
Article 5 of 14 – State of the Market 2026
One in five Irish enterprises now uses AI. So why is the average the least useful number?
Read Time: 5 min
One in five Irish enterprises with ten or more employees used AI in 2025. That’s approximately the EU average and around half Denmark’s rate. Adoption reached 58% among large Irish enterprises, while smaller surveyed firms lagged. Our analysis is pointing us to the conclusion that demand for evidenced, governed delivery will be concentrated where adoption, budget and regulation meet. This is a commercial expectation, not a forecast established by these figures.
In 2025, 20% of Irish enterprises with ten or more employees used at least one AI technology, up from 15.2% in 2024. The EU-wide figure was 20% (on Eurostat’s own harmonised basis, Ireland was 19.6%). Denmark was around 42%, Finland 38% and Sweden 35%. A separate ONS UK survey reported around 35% by June 2026 (note that its methodology and business coverage differ, so the UK result should not be ranked directly alongside Eurostat figures). As a market signal, the Irish enterprise-size breakdown is more useful context than a league-table position.
What the average hides
The average combines very different enterprise size classes. In 2025, 58% of large Irish enterprises (250 or more employees) used AI, compared with 29% of medium-sized enterprises (50–249 employees) and 17% of small enterprises (10–49 employees). Crucially, the enterprise AI survey covers businesses with at least ten employees (microenterprises are not included). The gap across size classes is real and the broader market interpretation remains an assessment.
Capability is concentrated in larger and technology-intensive organisations, although the distribution of practical agent-building skills is not measured by these adoption figures. IDA Ireland reports a significant ICT workforce and a strong presence of multinational technology firms. Early business results also point more clearly to operational benefits than to established revenue gains: PwC’s Irish AI Agent Survey reported productivity gains for 53% of respondents and cost reductions for 38%. Separately, PwC’s 2026 Irish CEO Survey found 17% reporting additional revenue from AI adoption. Globally, close to three-quarters of companies plan to deploy agentic AI within two years, but only 21% of those report a mature model for agent governance.
Public policy shapes the options. The Local Enterprise Office Grow Digital voucher supports eligible off-the-shelf software and related digitalisation, but excludes bespoke software development. For many smaller businesses, packaged tools are a sensible first step, although that does not make bespoke work inappropriate in every case. Exhibit 15 sets out five proposed priority buyer segments for autonomous software delivery. It is a segmentation hypothesis, not a measure of market share or of the total addressable market for custom software.
Figure 1: Bar chart comparing enterprise AI adoption across selected European countries in 2025.
Where the pressure to change is building
Three forces may convert interest into budget, particularly in larger and regulated organisations. We expect near-term opportunities to emerge disproportionately from these buyers, but this is our own market hypothesis, not an established prediction about how the national adoption gap will close.
The first is cost pressure alongside restrained hiring. Gartner’s CFO survey, as reported by CIO Dive, says 75% expected technology budgets to increase in 2026 while expected headcount growth fell from 6% to 2%. India’s five largest IT services firms added just 17 net employees over nine months, while HFS Research reports buyer interest in moving away from full-time-equivalent pricing. These indicators are consistent with pressure to buy technology-enabled outcomes, but00. do not show that particular Irish budgets have already been reassigned from hiring. Build-versus-buy decisions are shifting too: McKinsey reports that 32% of organisations have decided against buying off-the-shelf software and built their own with agentic coding tools, and that nearly half of AI high performers are skipping software purchases.
The second is skills and delivery economics. The EU employed 10.45 million ICT specialists in 2025, against a Digital Decade policy target of 20 million by 2030. The approximately 9.55 million difference is a gap to a future target, not a count of current vacancies. Kyndryl reports increasing difficulty sourcing AI skills. In Dublin, senior technology contractors were quoted at €395–€505 a day, and senior DevOps engineers at €450–€675. At €450 a day over 220 billable days, a five-person team would cost approximately €495,000 in contractor fees alone, before other project costs.
A third factor is changing build-versus-buy decisions. 32% of companies, and about half of AI high performers, have declined to buy software they could now build.
Furthermore, regulation adds specific obligations for affected organisations: DORA applies to relevant financial entities, the Central Bank of Ireland’s revised Consumer Protection Code took effect on 24 March 2026, and Ireland is implementing the EU AI Act through designated authorities and a national framework. The Digital Ireland strategy published in February 2026 sets out 90 deliverables, including digital public-service goals for 2030. Which tests, records, software bills of materials and assurance artefacts are required depends on the client, system, contract and applicable law. Buyers operating in regulated settings therefore have particular reasons to specify evidence at procurement and acceptance. Article seven sets out the compliance calendar in full.
Figure 2: Five proposed priority buyer segments for autonomous software delivery.
What it means if you are buying in Ireland
In a relatively concentrated enterprise market, leading buyers can influence expectations for software assurance and procurement. The five segments in Figure 2 – regulated mid-market and enterprise, the public sector, scale-ups, multinational subsidiaries, and private-equity portfolios – are where we expect autonomous software delivery to be tested first, though that remains a hypothesis.
Four things follow.
First, benchmark against your size class rather than only the national figure: AI adoption among large Irish firms was approximately 58%, but adoption does not imply mature governance.
Second, demand demonstrable outcomes and acceptance evidence, not simply a proposed number of contractor days.
Third, use applicable regulatory requirements as inputs to design and assurance rather than assuming DORA, the AI Act and the Consumer Protection Code mandate identical artefacts for every project.
Fourth, for small firms considering digitalisation, assess packaged tools and voucher eligibility first; commission bespoke software when a distinctive requirement or integration case justifies it.
Our thoughts? No Irish organisation will out-hire the scarcity, so buy capacity that arrives with its own verification, and keep the scarce people you have on the work that needs judgement: scope, risk, and acceptance.
What we hold ourselves to
We are a Dublin based small company building software for Irish, UK, and EU organisations (including regulated ones), so we have an interest in this argument and would rather state it than pretend otherwise. We see the opportunity in the gap between adoption and governed delivery, particularly among organisations with complex assurance demands.
Three rules follow.
We aim to sell evidence, not enthusiasm: for each engagement, we agree appropriate executed tests, coverage, software-component information and compliance records with the client, rather than claiming every Irish authority requires the same artefacts.
We say when bespoke is wrong: if a packaged tool or the Grow Digital voucher better serves a client, we say so.
And we seek to price against verified outcomes and capacity created, not simply contractor day rates. Forge exists to help a company our size deliver work at the standard regulated buyers reasonably demand.
Following the International AI Summit in Dublin on 14 October 2026, the more useful conversation is not Ireland’s position in a league table but what large organisations have actually changed in how they build, buy, and assure software.
So, a question for your own organisation: if yours is one of the 58% of large enterprises using AI, what has changed in how you build and buy software since you adopted AI – and if yours is one of the 42% that are not, what would you need to see before you moved?
Sources:
Central Statistics Office (Ireland), Information society statistics – enterprises 2025, February 2026. https://www.cso.ie/en/releasesandpublications/ep/p-isse/informationsocietystatistics-enterprises2025/
2. Eurostat, Artificial intelligence in enterprises (2025 data), January 2026. https://ec.europa.eu/eurostat/statistics-explained/index.php?title=Artificial_intelligence_in_enterprises
3. Office for National Statistics, Artificial intelligence in UK businesses: 2023 to 2026, July 2026. https://www.ons.gov.uk/businessindustryandtrade/business/businessservices/articles/artificialintelligenceinukbusinesses/2023to2026
4. IDA Ireland, Technology sector in Ireland, 2026. https://www.idaireland.com/explore-your-sector/business-sectors/technology
5. PwC Ireland, 2026 Irish CEO survey (including findings from PwC’s AI Agent Survey), January 2026. https://www.pwc.ie/reports/ceo-survey.html
6. Deloitte, State of AI in the enterprise 2026, January 2026. https://www.deloitte.com/us/en/about/press-room/state-of-ai-report-2026.html
7. Local Enterprise Office, Grow Digital voucher, 2026. https://www.localenterprise.ie/discover-business-supports/digitalisation/grow-digital/
8. CIO Dive, reporting Gartner's CFO survey: tech budgets rise in 2026 as headcount growth expectations fall, February 2026. https://www.ciodive.com/news/tech-budgets-cuts-2026-gartner/812385/
9. Computerworld, AI boom, hiring bust: Indian IT firms add just 17 net employees in nine months, January 2026. https://www.computerworld.com/article/4119064/ai-boom-hiring-bust-indian-it-firms-add-just-17-net-employees-in-nine-months.html
10. HFS Research, The headcount era is fading: the pivot to outcome and consumption pricing, July 2026. https://www.hfsresearch.com/research/headcount-era-fading-pivot/
11. Eurostat, ICT specialists in employment (2025 data), May 2026. https://ec.europa.eu/eurostat/web/products-eurostat-news/w/ddn-20260527-2
12. Kyndryl, People readiness report 2026, August 2026. https://www.kyndryl.com/us/en/insights/people-readiness-report-2026
13. Morgan McKinley, 2026 salary guide Ireland – technology contract rates, 2026. https://www.morganmckinley.com/ie/salary-guide/technology/contract-salaries
14. Yahoo Finance, reporting McKinsey: 32% of organisations decided against buying off-the-shelf software and built their own, September 2026. https://finance.yahoo.com/technology/ai/articles/build-vs-buy-shift-32-113806700.html
15. Central Bank of Ireland, Consumer Protection Code 2025 (effective 24 March 2026), March 2025. https://www.centralbank.ie/regulation/consumer-protection/consumer-protection-codes-regulations
16. Department of Enterprise, Tourism and Employment (Ireland), EU AI Act – national implementation, 2026. https://enterprise.gov.ie/en/what-we-do/innovation-research-development/artificial-intelligence/eu-ai-act/
17. Government of Ireland, Digital Ireland – connecting our people, securing our future (National Digital and AI Strategy), 18 February 2026. https://www.gov.ie/en/department-of-the-taoiseach/campaigns/digital-ireland-connecting-our-people-securing-our-future/
Made with AI, not by it. Claude researched and drafted; I rewrote and verified it. The charts are Claude's.
