Small Businesses Using AI Hired 7% More Staff Than Non-Adopters

Small businesses boost hiring with AI adoption

Small businesses that adopted artificial intelligence increased their workforce by approximately 7 percent more than comparable companies that did not use the technology, according to new research from business platform Gusto.

The finding challenges widespread concerns that AI primarily eliminates jobs. Instead, the data suggests automation of routine tasks may create capacity for small employers to expand their teams in customer-facing and hands-on roles.

Gusto's survey tracked roughly 2,000 small businesses and compared employment patterns between AI adopters and non-adopters. Among the businesses studied, 64 percent reported at least experimenting with AI tools. Of those early adopters, nearly two-thirds said the technology made it easier to launch or operate their business.

Why it matters

For small businesses with fewer than 25 employees, bandwidth is a constant constraint. If AI can reliably handle scheduling, marketing research, and administrative overhead, owners gain time to focus on revenue-generating activities and customer service—potentially shifting the economics of when it makes sense to hire. The 7 percent differential in headcount growth, sustained over multiple quarters, suggests this isn't a one-time effect but a structural change in how these businesses scale.

What businesses hired for

The new positions created by AI-adopting businesses concentrated in roles that require human interaction and specialized skills. Healthcare and social-assistance businesses added therapists and care staff. Other sectors hired teachers, technicians, cooks, and front-desk support.

"We can't see why any one business hired somebody, but the pattern fits a simple story: AI absorbs routine work, freeing owners to put more people on the work that serves customers," the Gusto researchers wrote.

The hiring growth wasn't a single-quarter spike. Businesses using AI found opportunities to expand their teams over multiple quarters, consistent with AI continuing to enhance productivity and business output.

Automation creates capacity

The research suggests AI tools help small businesses automate overhead functions including scheduling, marketing tasks, and research activities. For companies without dedicated staff for these functions, automation can remove bottlenecks that previously prevented expansion.

The Gusto team argues this freed capacity allows business owners to focus resources on customer-facing work and specialized roles that drive revenue—areas where human skills remain essential and where additional headcount delivers clear value.

The employment pattern observed in the survey indicates AI adoption may shift the composition of small business workforces rather than simply reducing total employment. Routine administrative work moves to software, while human effort concentrates on service delivery and skilled technical roles.

The findings were first reported by Inc. and are based on Gusto's analysis of employment data from its small business customer base.