Small businesses using artificial intelligence are adding workers as sales increase, research shows. Here’s how to get started.
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A quartet of witnesses testifying this week before the House Small Business Committee challenged the common belief that artificial intelligence will displace human workers and insisted that small businesses that use artificial intelligence are likely to end up hiring more employees — because they will grow.
Already, the majority of small businesses are using AI for a wide range of purposes, said Jordan Crenshaw, senior vice president at the U.S. Chamber of Commerce’s Center for Technology Engagement. Last year, 58 percent of small businesses nationwide reported using genetic artificial intelligence, an increase from 40 percent in 2024 and 23 percent in 2023, he told lawmakers. But the real takeaway, he added, is that 82% of small businesses that reported using AI had increased their headcount in the past year. “These businesses are not using AI to replace humans,” Crenshaw said. “They use it to help employees focus on high-value work that requires judgment, creativity and relationships.”
So what’s the best way for a small business to deploy AI?
- Focus on who you are not By doing now, this could increase sales. “So many small businesses don’t have a website,” observed Chike Aguh, head of innovation and strategy at the Kapor Center, which promotes tech inclusion. “So many small businesses don’t advertise in any way, shape or form because they can’t hire a designer. AI can make those things happen.” It’s not just about a website, it’s about a mindset. “Small businesses need to think, ‘What’s not happening in my business that AI can help make happen,’ instead of ‘What is happening now that could potentially be done by someone else?'” Aguh told lawmakers.
- Start with something that needs fixing. “I always advise businesses to start with the problem that’s most pressing. What’s bothering them every day? That’s where they start,” said France Hoang, founder and CEO of AI company BoodleBox, which creates online spaces where teams in education, law or business can use AI tools safely and collaboratively. He cited a small Detroit coffee company owner, Tekeyah Gaines, who said she has used AI to more accurately price her products and also to boost her marketing footprint. The result, Hoang said, is that Gaines’ average orders have increased from $38 to $47.
- Invest in training Al employees and listen to their ideas. Instead of replacing workers with AI, Aguh said, businesses should invest in training their workers on how best to use new AI tools and should even consult their staff on how and where to use AI.
- Think of AI as a force multiplier. “AI is a force multiplier that helps small businesses do more with limited time, staff and resources,” Crenshaw said. For example, he said, “A retailer can use AI to understand demand and personalize marketing. A restaurant can improve scheduling and inventory. A professional services firm can automate routine writing and research. A manufacturer can reduce waste and improve operations.”
- Make your back office more efficient. Aguh said small businesses are already finding AI useful for back office tasks such as accounting, tax payments, bookkeeping and lead generation in marketing and sales.
- Use artificial intelligence to simplify the onboarding and training of new staff. Anthony Qaiyum, owner of Chicago-based Merz Apothecary, told committee members that he recently used artificial intelligence voice transcription and writing tools to create a months-long onboarding program for a new hire. “He told me later that it was the clearest road map he had ever received when starting a new job,” he said.
- Make sure you choose the right AI tool for the job. There is a wide range of AI models now available online at low to no cost, with different strengths and weaknesses. It is important for users to learn which models are best for the job they want the AI to tackle. “It’s tempting to think that everything is a nail and that’s amenable to the AI hammer,” Aguh said. “Helping these small business leaders choose the right hammer for the right nail is very important. It could be Claude, it could be ChatGPT.”
- Find a secure AI system you can trust. The more honest a business owner can be with an AI system about internal finances and sensitive data, the more useful AI models can be to companies. Therefore, it is important to find an AI system that the business owner feels safe with. “AI is only as good as the information you put into it, the context. A lot of businesses are afraid to put their proprietary data out there. That’s unfortunate because that’s how you get the best results from AI,” Hoang said. “Find a platform where you feel the privacy and security allows you to use your data.”
- Look for AI accelerators, coaches, and government-funded training. Experts agreed that more AI literacy programs will be needed to properly educate entrepreneurs on how best to use new models, and pointed out that such resources are already available, such as the US Chamber of Commerce’s Small Business Basics program. “For those of us who are athletes at any point in our lives, you didn’t read a book on how to make a jump shot or throw a football. You did it on the field, with a coach,” Aguh said. “Artificial intelligence ironically shows the need for more work in the field, in the workplace… lessons are good. Real life experience is better.”
- Consider paying for AI if necessary. There has been so much progress and competition in AI in recent years that there are plenty of tools available online for free, but some of the most advanced and valuable tools still come with a price. It may be worth paying, depending on the job. “Basic AI is cheap and it’s everywhere,” Hoang said. “Premium AI that delivers real results still costs money and opens a new divide between Wall Street and Main Street.”
Qaiyum also told lawmakers that since his company began using artificial intelligence more heavily, it has increased its staff by 20 percent, from 50 to 60 employees. “We see (AI) as a set of tools that will help us increase our capacity and then bring in more people,” Qaiyum said. “Right now, we’re building an AI agent to handle routine accounts payable tasks that require an employee more than 20 hours a week, hours we’d rather spend helping them with strategic problems to grow our business.”
Qaiyum said Merz Apothecary – which sells health, beauty and grooming products – also relies on AI tools for cash flow analysis, inventory tracking, investment tracking, expense recording, payroll management and for potential financial risks.
“And we’re still hiring,” Qaiyum said. “We’re at the point now where we’d like to bring in someone who has more experience (with artificial intelligence) because we see so many opportunities ahead of us.” Qaiyum repeatedly insisted that AI is a new technological asset, while “people are the enduring asset you have.”
Crenshaw also warned that small businesses would suffer if Congress failed to act on AI regulation and left the issue up to the states, which would create a costly national “mess” of business rules that smaller companies would struggle to navigate.
He cited a study by the Information Technology and Innovation Foundation (a non-profit think tank that gets much of its support from the tech sector and other big companies). It concluded that without a national set of AI data privacy rules, it will cost the nation about $1 trillion over the next decade, with $200 billion of that falling on the small business community. He also singled out a relatively new California state law, the California Consumer Privacy Act, which underwent AI rulemaking after it was signed into law in 2020. Crenshaw said it will now cost small businesses an estimated $16,000 a year to comply with the AI portion of the law.
The bottom line, experts told lawmakers, is that AI won’t be able to replace truly human abilities, but rather should empower workers with new tools to become more efficient, productive and skilled. The four urged Congress to approve more funding for AI training for businesses and workers and create a national regulatory framework for future AI models, rather than the current state-by-state regulatory patchwork that is being developed in the absence of federal AI rules.
While the committee took no action on specific bills or proposals Tuesday, several members of the House said they believe it is important for Congress to pass some kind of national regulatory framework for artificial intelligence and technology companies, along with funding for artificial intelligence programs through the Small Business Administration.
“Our goal is to make sure that every small business and entrepreneur has a chance to succeed in the emerging era of artificial intelligence,” committee chairman Roger Williams, R-Texas, said at the start of Tuesday’s hearing.
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