Less than one-third of US state and local government and higher education organizations say they are prepared for AI-powered cyberattacks
Dallas, TX – March 18, 2026 – LevelBlue, the world’s largest pure-play provider of managed security services, today released its 2026 Spotlight Report: Cyber Resilience and Business Impact in US State and Local Government and Higher Education (US SLED). The report examines how public sector and higher education organizations are responding to a rapidly evolving cyber threat landscape as artificial intelligence accelerates both innovation and cyber risk.
The findings reveal that US SLED organizations expect a rise in AI-powered attacks, deepfakes, and synthetic identity attacks in 2025; however, many are not prepared for them. Only 28% of executives say their organization is prepared for AI-powered threats, even though 45% expect such attacks to occur. Similarly, just 33% feel prepared for deepfake and synthetic identity attacks despite 42% anticipating them.
At the same time, nearly half (46%) report experiencing a significantly higher volume of cyberattacks compared with a year ago, and 29% say their organization has suffered a breach in the past 12 months. Concerns around data security and privacy remain the biggest challenge, cited by 57% of US SLED executives. Meanwhile, nearly half (44%) report very low to moderate visibility into their software supply chain.
In response to these threats, many organizations are working to embed cybersecurity more deeply into strategic decision-making. The research shows progress in aligning cybersecurity with broader business goals: 70% of executives say their cybersecurity teams are aligned with lines of business, and 62% report that leadership roles are now measured against cybersecurity KPIs.
“Cyber resilience is becoming a critical operational priority for government and higher education organizations responsible for safeguarding sensitive data and essential services,” said LevelBlue Chief Security & Trust Officer Kory Daniels. “While it’s encouraging to see stronger alignment between cybersecurity teams and business leadership, our research highlights a gap between the threats organizations expect and their level of preparedness. Building resilience requires a proactive strategy that spans technology, culture, and leadership engagement.”
Research also shows that cybersecurity is increasingly being discussed at the highest levels of leadership. More than one-third (38%) of US SLED organizations say they are prioritizing greater boardroom engagement in cyber-resilience discussions over the next 12 months. At the same time, only 37% currently allocate cybersecurity budgets to new initiatives from the outset, indicating that many organizations are still working to fully integrate security into innovation planning.
Significant areas of additional cyber resilience investment from US SLED organizations include:
- Cyber-resilience processes across the business (34%)
- Generative AI defenses against social engineering attacks (30%)
- Machine learning for pattern matching (28%)
- Advanced threat detection technologies (27%)
The report also highlights a growing reliance on external expertise to strengthen cyber resilience. Over the next two years, 37% of organizations expect to engage cybersecurity consultants to help navigate the evolving threat landscape, while 45% anticipate working with incident response specialists to prepare for and manage potential breaches.
Based on these findings, LevelBlue recommends four specific steps to strengthen cyber resilience: elevating cyber resilience as a leadership priority, fostering a cyber-aware organizational culture, taking a proactive and intentional approach to security investments, and prioritizing software supply chain resilience through stronger supplier verification and continuous risk assessments.
Download the complete findings here to learn how public sector and higher education organizations are adapting to the changing threat landscape. This report follows the April 2025 release of the 2025 LevelBlue Futures Report: Cyber Resilience and Business Impact, which can be found here.
For more information on LevelBlue, please visit www.levelblue.com.
Methodology
The research is based on a quantitative survey carried out by FT Longitude in 2025. A total of 1,500 C-suite and senior executives across 14 countries and seven industries were surveyed: energy and utilities, financial services, healthcare, manufacturing, retail, transportation, and US state and local government and higher education (US SLED). The total number surveyed in the US SLED sector was 200.
About LevelBlue
LevelBlue reduces risk and builds lasting resilience so organizations can innovate and advance their mission with confidence. As the world’s most analyst-recognized and largest pure-play managed security services provider, LevelBlue elevates client outcomes that matter: stronger defense, faster response, and sustained business continuity. LevelBlue combines AI-powered security operations, advanced threat intelligence, and elite human expertise to provide the most comprehensive portfolio of strategic advisory, managed security, offensive security, and incident response services. Learn more at levelblue.com.
Media Contact
Devon Swanson, PR Director
LevelBlue
devon.swanson@levelblue.com
(831)737-3132
