How Small Businesses Are Using AI

published 13 September 2025

To help you understand the trends surrounding AI and other new technologies and what we expect to happen in the future, our highly experienced Kiplinger Letter team will keep you abreast of the latest developments and forecasts. (Get a free issue of The Kiplinger Letter or subscribe.) You'll get all the latest news first by subscribing, but we will publish many (but not all) of the forecasts a few days afterward online. Here’s the latest…

It usually takes a while for small businesses to adopt new technology. Compared to larger firms, smalls have tighter budgets and fewer employees to roll out new tech to.

But AI is bucking the traditional wait-and-see approach.

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Already, 58% of smalls use generative artificial intelligence, according to the 2025 Empowering Small Business Report, a recent survey by the U.S. Chamber of Commerce. That’s up from 40% in 2024, as more businesses harness AI chatbots, AI coding tools and image creation tools.

Most small businesses, defined in the survey as companies with fewer than 250 employees, believe their competitors are using AI or plan to do so soon. There are signs that AI adoption is helping businesses improve sales, keep customers, save money and otherwise enhance their operations.

AI use is sure to jump next year, too, as more AI tools become fully integrated into popular business software for marketing, payroll, accounting, inventory, sales, human resources and communications. Examples include QuickBooks, LinkedIn, Workday and Grammarly. Companies also tap the AI features built into search engines, such as Google and Perplexity, as well as AI tools from Facebook that make advertising on social media easier.

But that’s just the tip of the iceberg. Businesses even report using AI to navigate tariffs, find lower-cost suppliers, process returns, fulfill last-minute delivery, prevent fraud and develop customer insights, according to the survey.

AI trial and error

So what’s stopping some companies from taking the plunge? Top concerns include quality, cost and legal issues of AI tools. That hesitation comes with risk, as other businesses plow ahead and potentially gain an advantage.

Unlike large firms, most small businesses aren’t building custom AI tools from scratch, and instead are using it in traditional software and free options, such as OpenAI’s ChatGPT or Microsoft Office’s Copilot. And it’s not just office workers. Blue collar workers are increasingly using AI features in software designed for plumbers, electricians, painters and other tradespeople.

AI’s fast adoption is spurring small businesses to increasingly look for AI skills when hiring, and help current employees with AI training. “Nearly all (98%) small business AI users are working to upskill their employees,” according to the survey.

Still, it won’t be easy to find the best, most productive uses of AI. Strapped for time and money? Start by harnessing AI in software you have already purchased or try free tools. Don’t be surprised if some efforts fall short.

This forecast first appeared in The Kiplinger Letter, which has been running since 1923 and is a collection of concise weekly forecasts on business and economic trends, as well as what to expect from Washington, to help you understand what’s coming up to make the most of your investments and your money. Subscribe to The Kiplinger Letter.

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John Miley is a Senior Associate Editor at The Kiplinger Letter. He mainly covers technology, telecom and education, but will jump on other important business topics as needed. In his role, he provides timely forecasts about emerging technologies, business trends and government regulations. He also edits stories for the weekly publication and has written and edited e-mail newsletters.

He joined Kiplinger in August 2010 as a reporter for Kiplinger's Personal Finance magazine, where he wrote stories, fact-checked articles and researched investing data. After two years at the magazine, he moved to the Letter, where he has been for the last decade. He holds a BA from Bates College and a master’s degree in magazine journalism from Northwestern University, where he specialized in business reporting. An avid runner and a former decathlete, he has written about fitness and competed in triathlons.