This Study Says AI Isn’t Killing Jobs—It’s Helping Small Businesses Grow

An analysis by Gusto found small businesses using AI got more productive and hired more people.

BY BRUCE CRUMLEY @BRUCEC_INC

A new data study of small businesses reveals entrepreneurs are already getting productivity and job creation benefits through early adoption of artificial intelligence tools. However, that extra output has been smaller than promised in the hype from companies selling the tech. Meanwhile, the ongoing employment lift has tended to favor older people over younger recruits already struggling to get entry-level work.

Those findings came from data analysis of over 7,7000 entrepreneurs tracked between January 2023 and last November by payroll and employee management service company Gusto. The main lessons are that the embrace of AI by smaller businesses has thus far mostly produced positive but limited results. Yet at the same time, AI use hasn’t brought about the huge negative employment consequences forecast by skeptics.

“The latest data on small-business hiring from Gusto shows that AI isn’t the ‘jobs apocalypse’ for small companies that some have feared,” the company’s report on the study said. “Our evidence suggests that small businesses with more AI-exposed workforces are seeing revenue and hiring gains — not the dramatic job losses that some have predicted. There’s a learning curve, but early evidence points toward growth, not decline.”

Still, that boost hasn’t been as dramatic as most companies developing and selling AI apps had predicted. One obvious reason for that is the sluggish pace of entrepreneurs using the new tech to automate work tasks over the three-year study period.The total portion of “AI-exposed work” in small businesses Gusto monitored remained nearly flat in 2025 at 16.4 percent of the total number of workplace tasks identified. Yet benefits to companies that were quicker to use AI to automate work were clear. Data showed companies that increased their use of the tech by 10 percent at a given point benefitted from a 2.2 percent increase in revenue within six months.

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“(That’s) equivalent to about $53,800 in additional annual revenue for a typical firm in our sample,” the report said, noting AI appeared to be improving how employees worked, rather than changing or eliminating their jobs as feared. “(T)he early impact seems to be happening within existing jobs, as employees adopt new tools and workflows, rather than through sweeping changes in who gets hired.”

Indeed, Gusto’s data crunch showed how widespread fears of AI taking over jobs and leaving those workers unemployed have missed the mark among its pool of surveyed small businesses. Instead, companies it analyzed collectively expanded headcount by 9.6 percent. But those that had increased their use of AI by at least 10 percent added about 1.7 percent more staffing than the rest within the first half year of doing so.

Still, there is something of a catch in that evolution. Increased deployment of AI didn’t affect all workers the same, positive way.

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