Poll Shows Small Businesses Are Interested in and Benefit from AI

Last year was “a year of groundbreaking advances in AI and computing.” Artificial intelligence (AI) continues to transform almost every area of the economy, from business operations to the workforce. Opportunities and challenges exist with these technologies for businesses of all sizes, but the impact is felt more acutely by small businesses which often have fewer resources and increased barriers to adopting any new tool.

A new poll by the Bipartisan Policy Center and Morning Consult offers several insights into small business AI use – both the good and the bad. Since small businesses make up around 44% of all U.S. economic activity, understanding how their owners successfully use technology is paramount to a strong national economy.

Significant progress in connecting small business owners to AI has occurred over the last two years. In a 2022 BPC and Public First poll, 74% of small business owners believed digital skills were important to their business. However, only 21% of that group were early adopters of new technology, and only 52% planned on making investments in digital tools over the next year.

The 2023 BPC and Morning Consult poll reveals that 83% of small business owners who use AI  say it has been helpful in improving systems, increasing efficiency, focusing time on more valuable tasks, and helping produce content. 54% say it has had a positive impact on business growth. Moreover, 33% of small business owners are early adopters of new technology, and 58% plan to invest in AI over the next year.

Notably, the 2022 poll asked about digital tools broadly—any program, software, or application that runs on a digital device like a computer, tablet, or smart phone—while the 2023 poll focuses only on AI. In that short period of time, AI completely revolutionized the digital tool market, with many companies adding AI features to their existing platforms or producing AI-based products. This rapid change highlights the need for policymakers to catch and keep up with changes to better serve small businesses.

Recent technological advancements play a central role in AI’s growing prevalence. Generative AI refers to artificial intelligence that can generate text, images, or other data in response to prompts. In the last year, generative AI products, such as OpenAI’s ChatGPT, have enabled individuals and small businesses to use this new technology without significant special training or equipment. Specifically, it enhanced the customer experience through chatbots, streamlined the research and brainstorming process, and even helped produce articles and marketing material.

Minority small business owners have a better experience with AI than white small business owners.

• More Black (76%) and Hispanic (69%) than white small business owners (63%) believe AI will have a positive impact on their business two years from now.
• Black (75%) and Hispanic (77%) small business owners plan to make more investments in AI over the next year than white small business owners (54%).

Male small business owners use AI more and have better experience with it than female small business owners.

• Male small business owners (38%) are early adopters of new technology at a higher rate than their female counterparts (27%).
• Slightly more male small business owners (30%) have a very positive view of AI compared to female small business owners (23%).
• Male small business owners (64%) are more likely to make investments in AI over the next year than female small business owners (51%).

Recent research from McKinsey shows that the bulk of AI-induced job losses will affect women, which may partially explain the gender gap in its adoption among small business owners.

Younger small business owners are noticeably more comfortable with AI than their older peers.

• Small business owners under 45 seem to enjoy the most success with AI, with 69% reporting that AI had helped their business.
• Small business owners under 35 (79%) have a more positive view of AI than small business owners aged 65 or older (53%).
• Over the next two years, more small business owners under 35 (78%) believe AI will have a positive impact on their business than small business owners aged 65 or older (41%).

Larger businesses are more interested in AI investments than smaller businesses.

• More business owners of companies with 100 or more employees that use AI (85%) plan to make investments in it over the next year than business owners of companies with 10 or fewer employees (53%).

AI use has historically been concentrated among bigger businesses. With larger employment bases, more sophisticated systems, and well-funded research departments, larger businesses can experiment more than resource-constrained smaller businesses.

The biggest barriers to AI use among small businesses include the cost of AI tools (55%), uncertainty over possible government regulation (50%), data privacy (49%), not knowing what tools to use (48%), and employees’ lack of digital skills (46%).

On October 30, 2023, President Biden signed an Executive Order on artificial intelligence. In addition to reducing barriers to adopting AI, the order also “establishes new standards for AI safety and security, protects American’s privacy, advances equity and civil rights, stands up for consumers and workers, promotes innovation and competition, advances American leadership around the world, and more.”

For small business owners, the order provides technical assistance and resources for adoption of AI technologies. However, small business owners believe financial assistance (48%) would help their company better than technical assistance (32%). To supplement the absence of funds from President Biden’s Executive Order, most small business owners (71%) are at least somewhat interested in utilizing the Small Business Administration’s loan program to finance adoption of AI technology.

Current government resources on AI are also lacking. Only 12% of small business owners use government resources to seek information and advice about AI tools. Given the potential impact of AI on businesses, The Organization for Economic Cooperation and Development (OECD) recommends that policymakers should focus on, “fostering a digital ecosystem for AI through knowledge-sharing mechanisms and connections with private industries.”

Additionally, policymakers need to be ready to address gender and racial differences in attitudes about and experiences with AI. In addition to further considerations about how to mitigate widespread concerns about bias common among Americans, the survey shows promise that AI can bolster small businesses and the economy. Policies that help foster AI adoption can help businesses grow and succeed.