US Small Business AI Adoption Rate 2026: 17.7% Pay for AI

"Short answer: 17.7% of US small businesses were paying for AI tools in December 2025, up from 5.2% in January 2023 (JPMorgan Chase Institute, based on real payments). The US Census Bureau puts AI use at 17% to 20% of businesses. Surveys that count any use at all go higher: Thryv found 55% in 2025."

Key Takeaways

117.7% of US small businesses paid for AI services in December 2025, up from 5.2% in January 2023 and 1.7% in January 2019 (JPMorgan Chase Institute, based on actual payments).
2The US Census Bureau found 17% to 20% of US businesses used AI between December 2025 and May 2026. It was 32% for firms with 100 to 249 employees and under 20% for firms with four or fewer.
3The Federal Reserve estimates about 18% of US firms had adopted AI by the end of 2025.
4Surveys that count any use run higher: Thryv found 55% of small businesses used AI in 2025, up from 39% in 2024, and 68% among firms with 10 to 100 employees.
5The top reason small firms skip AI is that it does not seem to fit: nearly 82% of businesses with fewer than five employees gave that reason for not planning to use it (SBA Office of Advocacy, 2025).
6Small firms are catching up. On the SBA measure, small business AI use rose from 6.3% to 8.8% in six months of 2025 while large-firm growth slowed.

Updated September 28, 2026. Every figure below was re-checked against its source that day.

The short answer

17.7% of US small businesses were paying for AI tools in December 2025, up from 5.2% in January 2023 (JPMorgan Chase Institute). The US Census Bureau puts AI use at 17% to 20% of US businesses, and the Federal Reserve says about 18%. The 55% figure you may have seen comes from a survey that counts any use at all. So roughly four out of five small businesses have not made AI part of how they run yet.

Want to be in the 17.7%, without guessing? We build custom AI agents for small businesses: customer support, lead follow-up and order questions, connected to the tools you already use. See AI agent development or AI automation services.

Why You See Both 55% and 17.7%

You have probably seen the headline “55% of small businesses now use AI.” That number is real, but it measures something different from what most people assume.

The 55% figure comes from Thryv's 2025 survey of 540 small business decision makers, up from 39% in 2024. It counts owners who say they use AI in some way. That includes someone who used ChatGPT once to draft an email.

The 17.7% figure comes from the JPMorgan Chase Institute's analysis of actual payments small businesses made to AI providers through December 2025. It is payment data, not a survey. A business that pays for an AI tool every month is using it for real work.

Neither number is wrong. The gap between them, about 37 percentage points, is the gap between trying AI and running part of the business on it. That gap is the most useful thing in this whole data set.

Government Data Shows 17% to 20% of US Businesses Use AI

The US Census Bureau's Business Trends and Outlook Survey asks businesses about AI every two weeks. From December 14, 2025 to May 3, 2026, the numbers held steady:

17% to 20% of US businesses reported using AI
Firms with 4 or fewer employees: less than 20% reported AI use
Firms with 100 to 249 employees: 32% reported AI use

The Federal Reserve's April 2026 note lands in the same place: about 18% of firms had adopted AI by the end of 2025. When the government data and the payment data agree this closely, you can trust the level.

What Each Source Actually Measures

Source	What it counts	Latest figure
JPMorgan Chase Institute	Small businesses paying an AI provider	17.7% (Dec 2025), up from 5.2% (Jan 2023)
US Census Bureau (BTOS)	Businesses using AI, asked every two weeks	17% to 20% (Dec 2025 to May 2026)
Federal Reserve	Firms that have adopted AI, summary of several data sets	About 18% (end of 2025)
SBA Office of Advocacy	Small (under 250 staff) vs large firms, from Census data	8.8% small vs 11.1% large (2025)
Thryv survey	Owners who say they use AI at all	55% (2025), up from 39% (2024)

The SBA figure is lower than the Census headline because it uses an older, stricter Census question and a different time window. The direction is the same in every source: up, and faster since 2023.

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Why Most Small Firms Still Skip AI

The biggest reason is not cost or fear. It is fit. When the SBA Office of Advocacy looked at why businesses were not planning to use AI, nearly 82% of businesses with fewer than five employees said AI was not applicable to their business. The next reasons were far behind: lack of knowledge about AI (6.7%) and privacy concerns (6.3%). As businesses get bigger, fewer say “not applicable” and more complex concerns, like cost and security, move up.

This is not resistance. It is a failure of relevance.

The AI tools that get the most press, like chat assistants, image generators and code assistants, are built for office workers and software teams. A plumber in Tampa, a boutique owner in Nashville, or a food distributor in Charlotte does not immediately see where ChatGPT fits into their Tuesday.

The businesses that make AI stick do not start with a general tool. They start with one specific job: answering the customer service queue, writing product descriptions, or following up with leads at 2am. At FactoryJet, we build that job into the websites and online stores we deliver, so the AI part works on day one.

How Small Businesses That Use AI Actually Use It

Thryv's 2025 survey asked owners who use AI what they use it for. These are self-reported, so read them as direction, not precise measurement:

Data analysis: 62%
Content generation: 55%
Customer engagement tools like chatbots: 46%
Use AI daily: 63%
Save more than 20 hours a month: 58%

Twenty hours a month is half a work week. That is the real prize, and it comes from putting AI on repeat work, not from trying a new tool every week.

Small Firms Are Catching Up. The Window Is Still Open.

In early 2025, large businesses used AI at 1.8 times the rate of small ones: 11.1% against 6.3%, on the SBA's measure. Six months later the small business share had climbed to 8.8% while large-firm growth slowed. The SBA estimated small firms may be only about a year behind.

The businesses that will look back on 2026 as a turning point are the ones that moved from “we tried it a few times” to “AI handles this job for us.” That is not about buying the most advanced tools. It is about picking the three or four tasks your team does by hand every week and putting AI on those.

If you run an online store: AI answers to customer and order questions, AI-written product descriptions, and AI product recommendations are the usual starting points. If you run a service business: AI lead follow-up, AI appointment booking and AI help with marketing content tend to pay back fastest. For local service businesses in competitive markets, like HVAC, plumbing or home services in Northeast Ohio, there is a newer reason it matters too. Buyers increasingly ask ChatGPT or Perplexity for a recommendation before they ever open Google, and you can check whether those tools name your business in about a minute.

The 17.7% who are already there are not smarter than the other 82.3%. They just started earlier.

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Frequently Asked Questions

What percentage of US small businesses use AI in 2026?

It depends on what you count. 17.7% of US small businesses were paying for AI services in December 2025, per JPMorgan Chase Institute payment data. The US Census Bureau found 17% to 20% of businesses used AI from December 2025 to May 2026, and the Federal Reserve puts it at about 18% of firms at the end of 2025. Surveys that count any use, even once, go higher: Thryv found 55% in 2025.

What is the small business AI adoption rate trend?

It is climbing fast. JPMorgan Chase Institute data shows the share of small businesses paying for AI went from 1.7% in January 2019 to 5.2% in January 2023, then to 17.7% by December 2025. Most of that jump came after 2023. Thryv's survey shows the same direction: self-reported use rose from 39% in 2024 to 55% in 2025.

Why do AI adoption statistics for small businesses disagree so much?

They measure different things. JPMorgan Chase counts businesses that actually paid for an AI service. The Census Bureau asks whether a business used AI to produce goods or services. Surveys like Thryv's ask owners whether they use AI at all, which includes trying a free chatbot once. Paid use is the best sign that AI is part of how a business runs day to day.

What are the biggest barriers to AI adoption for small businesses?

Relevance, by a wide margin. The SBA Office of Advocacy found nearly 82% of businesses with fewer than five employees said AI was not applicable to their business when asked why they were not planning to use it. The next reasons were far behind: lack of knowledge about AI (6.7%) and privacy concerns (6.3%). As businesses get bigger, more complex concerns such as cost and security move up.

Are small businesses catching up to large companies in AI adoption?

Yes. The SBA Office of Advocacy reported that in early 2025, 6.3% of small businesses (under 250 employees) used AI against 11.1% of large ones, a factor of 1.8. Six months later the small business share had risen to 8.8% while large-firm growth slowed. The SBA estimated small firms may be only about a year behind.

Does company size change AI adoption?

Yes. In the Census Bureau data, 32% of firms with 100 to 249 employees used AI as of May 2026, while fewer than 20% of firms with four or fewer employees did. The SBA also found a U shape: the very smallest businesses, under five employees, used AI more than other small businesses.

How are small businesses actually using AI?

In Thryv's 2025 survey of 540 small business decision makers, the top uses were data analysis (62%), content generation (55%) and customer engagement tools like chatbots (46%). 63% said they use AI daily and 58% said it saves them more than 20 hours a month. Treat these as self-reported numbers from owners who already use AI.

What is the most credible source for small business AI adoption data?

The US Census Bureau Business Trends and Outlook Survey and the JPMorgan Chase Institute. Census asks a large sample every two weeks with a strict definition. JPMorgan Chase looks at real payments to AI providers, so it is not based on what owners remember. The Federal Reserve's April 2026 note is a good summary of both. Thryv and other surveys are useful for direction, not for the exact level.

Is it too late for a small business to start using AI?

No. On the payment data, about 82% of US small businesses were still not paying for any AI service at the end of 2025. The businesses that pull ahead are not the ones with the fanciest tools. They picked one or two jobs that eat the most hours every week, like answering the same customer questions or following up on leads, and put AI on those first.

What's the difference between AI chatbots and AI agents for small businesses?

A chatbot answers questions from a knowledge base. It responds but does not act. An AI agent can finish a task with several steps: follow up with a lead, update a CRM record, send a quote or book an appointment. Agents do more, but they need to be connected to your systems and tested properly, which is the part most small businesses need help with.

How do I know which AI project to start with?

List your three most time-consuming repetitive tasks and how many hours each takes a week. Pick the one where a mistake is cheap to fix and the volume is high, such as order status questions, lead follow-up or product descriptions. Start there, measure hours saved for a month, then decide on the next one.

Are AI tools safe for small businesses to use?

The main risks are data privacy (feeding customer or private data into a third-party AI system), wrong answers, and relying on it too much. Read each tool's data usage policy before you give it customer data, check AI-written content before it goes out, and keep a person in the loop for anything high-stakes, like refunds, pricing or legal wording.

How much does it cost to add AI to a small business?

Off-the-shelf AI tools are monthly subscriptions, and many have free tiers. A custom AI agent connected to your own store, CRM or inbox is a one-time build plus running costs that depend on how much it is used. Our AI agent cost guide breaks down what drives that number, and we give a written scope before any build starts.

Is there a government source for AI adoption data?

Yes. The US Census Bureau's Business Trends and Outlook Survey (BTOS) tracks AI use every two weeks. The Federal Reserve published "Monitoring AI Adoption in the US Economy" in April 2026. The SBA Office of Advocacy published "AI in Business: Small Firms Closing In" in September 2025. All three are free to read.

How do I get started with AI for my website or online store?

Start with the job that costs you the most hours: customer questions, order status, lead follow-up or product content. FactoryJet designs and builds custom AI agents for those jobs, connects them to your store, CRM or inbox, and stays on to support them after launch. You own what we build. Book a 30-minute call and we will tell you which job to automate first.

Written by

Bhavesh Barot

Founder & CEO

Founder & CEO of FactoryJet, an ecommerce and AI services company that has served 500+ businesses across the US, UK, UAE, and India. Writes about ecommerce builds, AI agents, and AI search.

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