British companies have been reducing their spending on public relations and management consultancy as AI-powered tools take on a larger share of those functions, according to the Business Spend Pulse report.

Outlays by UK businesses on management consultancy and public relations contracted to 4.2 per cent of firms in September, even as total expenditure across all categories climbed 3.1 per cent against the same month a year earlier.

The Spend Pulse index draws on proprietary transaction data that Capital on Tap — a fintech company supplying business credit cards and expenditure management tools to small and medium-sized enterprises — shares exclusively with the publication. The dataset is built from transaction records generated by Capital on Tap card activity across a pool of more than 300,000 UK businesses.

Consulting firms themselves reduced outlays by close to 4 per cent during September — a contraction that outpaced every other sector recorded that month — as the industry contended with a shrinking client base. Expenditure climbed across a range of other sectors, with food retailers posting a 9.3 per cent rise, property developers recording growth of 7.9 per cent, and leisure goods and services adding 4.2 per cent.

Outlays directed at AI-related tools climbed over the year, with roughly one in seven businesses having paid for products from leading AI providers by September, up from around eight per cent at the same point twelve months earlier. Anthropic drew the largest share of AI investment flows, capturing roughly half of all funding directed at artificial intelligence companies, while OpenAI's ChatGPT saw its portion of that spending contract from around 60 per cent to 36 per cent.

Capital on Tap chief executive Damian Brychcy noted that established businesses were directing about 3 per cent more than in the previous year, with discretionary outlays climbing at a faster rate than essential costs and most sectors posting year-on-year gains. He described the pattern as small firms channelling money into expansion rather than merely meeting day-to-day obligations, and said uptake of artificial intelligence tools remained the dominant shift his company was tracking.

Spending patterns among AI-adopting businesses have shifted alongside adoption rates: a typical company in that group is now directing roughly double the budget toward these tools compared with twelve months prior. London retained its position as the city with the greatest proportion of AI-spending businesses, at above one in five, though Edinburgh and Milton Keynes trailed narrowly, recording AI expenditure rates of 17.1 per cent and 17.2 per cent of businesses respectively.

Expenditure by UK businesses on Starlink and related satellite services climbed by nearly half over the course of a year, a period that also saw SpaceX complete a trillion-dollar stock market listing in the United States.