Heat 1 tablespoon olive oil in a large Dutch oven over medium heat. Add the chopped bacon and cook until crisp. Remove the bacon with a slotted spoon and set it aside, leaving the fat in the pot.

Season the lamb cubes with salt and pepper. Working in batches, brown the lamb in the bacon fat for 3 to 4 minutes per side. Transfer the browned lamb to a plate.

Add the remaining tablespoon of olive oil if needed, then stir in the onion, carrots, and garlic. Cook for 5 minutes until the onion softens.

Add the sliced mushrooms and cook for another 3 minutes until they begin to release liquid.

Sprinkle the flour over the vegetables and stir for 1 minute. Stir in the tomato paste until everything is coated.

Pour in the Guinness, scraping the bottom of the pot to loosen any browned bits. Add the beef broth, pearl barley, thyme, and bay leaves. Return the lamb and bacon to the pot.

Bring the stew to a simmer, then cover and cook on low heat for 1 hour and 45 minutes, stirring occasionally, until the lamb is tender and the barley is cooked through. Remove the bay leaves before serving.