(June 6, 2026 / Pesach Benson/TPS-IL)
Israeli companies are rapidly artificial intelligenceNearly four in 10 companies expect to implement this technology within six months, up from roughly one in four a year ago.
Figures released by the Central Bureau of Statistics on Thursday suggest that Israel is one of the first countries in the world to introduce working conditions. A.I.Governments and businesses continue to grapple with how to measure and regulate technology adoption.
One of the most notable developments is the rapid increase in adoption across traditional manufacturing industries. Manufacturing, power, and water companies (sectors not typically considered early adopters of technology) saw a significant increase in the use of AI between June 2025 and March 2026. Usage in administrative and business processes increased from approximately 14% to 52%, and in marketing and sales applications from approximately 16% to 57%.
Among companies already using AI, the most common use case is management and business processes, including planning and recruitment, cited by approximately 63% of companies using AI. For companies in the non-high-tech service sector, this figure rises to 69%. Marketing and sales ranks second, with about 46% of AI-adopted companies using it, and about 35% reporting using AI for product development or direct customer service, with a similar share in research and innovation.
The high-tech and financial sectors still lead the overall economy by a large margin. Approximately 73% of companies in these industries use AI for R&D, compared to 35% across all industries. Half also report using AI to make products and serve customers.
A panel analysis that tracked more than 800 companies across both study periods found that companies that have been using AI for an extended period of time are more likely to report significant increases in employee productivity. At the same time, more mature AI users are more likely to report lower employment levels, suggesting that deeper integration of technology may be associated with changes in the workforce and increased efficiency.
Regarding barriers to adoption, approximately 76% of companies not currently using AI say that AI technology is not relevant to their economic activities, a number that has remained largely unchanged since June 2025. However, the proportion citing lack of knowledge about AI capabilities has nearly doubled, from approximately 8% to 16%, suggesting that limited understanding of the technology is becoming a more significant barrier to adoption as the technology becomes more widespread.
In the tech and financial sectors, the percentage of non-adopters who believe AI is irrelevant to their business fell sharply from 78% in June 2025 to 39% in March 2026. This suggests that more companies, even those that have not yet implemented AI, are seeing it as relevant to their future operations.
The findings are based on a survey of approximately 36,551 companies with 10 or more employees conducted in March 2026 as part of Israel’s monthly Business Trends Survey, which tracks business activities and expectations. This report builds on previous findings from June 2025 and aims to enable international comparisons of AI adoption trends across economies.
