KPMG Survey: Boston Leaders Pair AI Acceleration With Workforce Upskilling as Growth Plans Evolve

NEW YORK  - Boston businesses are undergoing a year of strategic transformation as they adapt their growth strategies for an AI-driven economy. Leaders surveyed are committing to strategic investments in AI acceleration and workforce upskilling as they refine hiring and real estate plans to optimize for efficiency and resilience, according to a new study released today by KPMG LLP, the U.S. audit, tax and advisory firm.

The KPMG 2026 Perspectives: Local Insights from Boston report illustrates a city accelerating its growth trajectory through innovation and talent strategies, even amidst ongoing challenges facing the market such as talent retention and cost of living. Nearly all business leaders surveyed (98%) are providing AI education and training, with 91% investing in upskilling current employees specifically to reduce external hiring needs. This investment reflects AI's elevated status, as 90% rank it among their top investment priorities despite economic uncertainty.

 “Boston’s leaders are advancing innovation with a people-first mindset,” said John Capone, KPMG’s Boston Managing Partner. “AI adoption and workforce upskilling are moving in tandem, while hiring and commercial real estate plans are being calibrated for efficiency. At the same time, businesses are navigating tariffs and economic uncertainty with strategies to sustain growth.”

The KPMG 2026 Perspectives: Local Insights from Boston report surveyed 81 business leaders (60.5% C-suite; all VP-level and above) at companies with annual revenues of more than $50 million on the key challenges and opportunities in driving business growth in the city. Key findings are highlighted below.

Boston’s strategic shift favors AI adoption and workforce upskilling.

CAPONE: “Growth prospects seem tempered by headwinds facing the current business environment, especially around overall geopolitical and domestic uncertainty. Still, many leaders are working hard to build AI fluency across their teams, fine-tune hiring and commercial real estate decisions to enhance efficiency and stay focused on the opportunities that matter."

• Respondents shared their confidence in the growth prospects for their company (94%), their industry (91%), city (89%), state (91%), and country (82%) in 2026.
• The issues most top of mind for them reflect emerging risks and the need for resilience in a rapidly changing environment.
  • The top three issues include: integration of AI (51%), cybersecurity threats (43%), and macroeconomic and market conditions (42%).
• Technology and software (56%) are expected to drive the most economic growth over the next 12-18 months, followed by life sciences and biotech (19%) and financial services (12%).
• Hiring and commercial real estate expansion plans remain strong but have eased since 2025. 78% project headcount growth (down from 85%) and 63% aim to expand their footprint (down from 72%).
• 91% of respondents agree they are investing in upskilling current employees in AI to reduce the need for external hiring.

AI transformation accelerates in Boston as leaders focus on capability building and operational impact.

CAPONE: “Boston businesses are pairing technology with talent to drive transformation. By embedding AI into core strategies and equipping employees with advanced skills, organizations are positioning themselves to lead in a more competitive, technology-driven economy.”

• 93% plan to increase AI usage in 2026, compared to 85% last year.
• 90% rank AI as a top investment priority despite economic uncertainty.
• AI agent adoption is progressing: 42% plan to deploy, 42% are exploring, and 12% are piloting solutions.
• 93% believe agentic AI will transform operating models, and 89% expect employees to manage multiple AI agents as part of their roles.
• While 62% anticipate some workforce reductions, 95% agree AI will automate tasks without eliminating jobs.
• 83% of small business respondents say AI is leveling the playing field, and 85% say it will help nonprofits achieve greater impact with limited resources.
• Key challenges remain: 33% cite technical capability and 15% cite data readiness as barriers to scaling AI adoption.

Boston businesses are balancing AI adoption and cultural connection as workforce demands evolve.

• Respondents believe that Boston's top competitive advantage compared to other markets is the quality and specialization of its talent pool (23%), followed by access to world-class academic institutions and research talent (22%), and quality of life and cultural amenities for employees (20%).
• 33% worry about losing high-growth tech startups to other markets, underscoring the need for robust retention strategies in a competitive landscape.
  • Career growth opportunities (43%) are a top driver of retention, and leaders are prioritizing development pathways to keep talent in Boston’s competitive market.
• 98% of business leaders surveyed are providing AI education and training,
• 86% prioritize AI skills in hiring and 89% use AI tools in screening and selection, while 52% are reducing entry-level hiring.
• To mitigate risks, 79% plan increased investment in AI integration and workforce upskilling, while 75% are boosting cybersecurity investments and 49% are enhancing talent acquisition strategies.
• 98% are intentionally creating spaces—physical or virtual—for connection and collaboration, and 89% encourage non-work-related breaks and events.

Boston businesses pursue strategic dealmaking while navigating varied tariff impacts.

CAPONE: “We’re optimistic that there will be a strong appetite for acquisitions in 2026, after one of the lowest transaction years in recent memory last year. The opportunity will be greatest for those organizations who move to capture strategic opportunities.”

• 46% of respondents have a high appetite for acquisitions, 36% plan moderate acquisition activity, and 11% are unlikely to pursue deals in 2026.
• 59% plan to pursue dealmaking in the first half of 2026, while 31% plan for the second half of the year, suggesting early movers seek to capitalize on favorable conditions.
• 56% report they have seen increased sales as a result of tariffs, while 12% report declines and 22% see no change, pointing to sector-specific impacts and strategic adjustments.

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