Small Business’ AI Divide: A Minority Have Reaped Big Benefits, But Many Feel Unprepared

There's an artificial intelligence divide among the American small business community. A new survey of 200 small business owners finds virtually all (99%) are using artificial intelligence to some limited degree, and a minority report heavy use and big benefits.

Yet technology and AI stand out as the areas that the highest share of business owners say they feel "unprepared" to deal with. For example, while only 29% said they felt unprepared to deal with e-commerce and 35% with staffing issues, 40% said they were unprepared to deal with AI adoption and 43% with some aspect of technology or operations. (Overall, a whopping 97% "feel unprepared in at least one key area of their business," according to the study , conducted by Wakefield Research for TD Bank.)

While 61% said their use of AI had risen "somewhat" over the past six months, only 17% said it was significantly higher. The biggest barriers small businesses say prevents them from wrapping both arms around artificial intelligence? Almost a third, 31%, said it was concerns related to data privacy or security. Nearly a quarter, 24%, cited a lack of employee training. Other rationales included the cost, lack of employer knowledge regarding AI systems, and uncertainty over how AI would add value to the business.

How has AI helped small business users? In the survey, 57% of respondents said that utilizing AI saved time, 55% said it had improved cash flow decisions, 52% said it had helped increase sales and revenue, 42% said it was helpful in reducing overhead, and 41% said it had helped in detecting fraud.

Among small businesses that have willingly embraced AI, 17% reported using the technology had allowed them to significantly increase head counts–an outcome that other small business AI boosters have previously touted . While there are growing concerns about economy-wide job loss, particularly in certain white-collar and entry level positions , that doesn't mean that specific small businesses which successfully harness AI can't grow their share of the revenue pie enough to hire more workers.

Indeed, there's evidence in the TD Bank study that businesses do see themselves–happily or not–in a race for AI adoption. Some 62% of the businesses said they expected to seek new financing in the coming months. Of those, the top reason for needing financing (23% named it), was new equipment or technology; the second most cited reason (at 20%) was the need to invest in AI. Only 8% said they'd be using the financing for a new location or market.