AI isn’t the “jobs apocalypse” for small businesses that some have feared, according to the latest data on small-business hiring from Gusto. The recent report, The Reality of AI’s Impact on Small Businesses, was written by Gusto economist Tom Bowen and Andrew Chamberlain, Ph.D., Gusto’s Chief Economist and Insights Group leader.
Their research shows that “small businesses with more AI-exposed workforces are seeing revenue and hiring gains—not the dramatic job losses that some have predicted.” The authors add that while there’s a learning curve, the early evidence points to growth, not decline.
Gusto says this is the “first close look at AI’s impact on Main Street.” Even though small businesses employ 45.9% of American workers, most AI-and-jobs research has focused on large employers.
Who Benefits From AI?
The report also shows that the benefits of AI will not likely be evenly distributed. Gusto reports that “younger workers entering AI-related fields face a more competitive landscape, while experienced workers appear better positioned to benefit.”
Bowen and Chamberlain also looked at how “AI exposed” small businesses are—how much of the work could be “significantly helped or potentially performed by AI.” They found:
- Jobs like copywriters, accountants, and customer service representatives are
highly AI-exposed because AI can assist with many of their core tasks, such as drafting content, crunching numbers, or answering common questions.
- Jobs like electricians, plumbers, and dental hygienists are less AI-exposed because their work relies heavily on hands-on skills that AI can’t replicate.
Which Industries Are Pivoting Toward AI?
Even though the U.S. national average of AI exposure is flat, Bowen and Chamberlain report that some small-business sectors have benefited “in meaningful ways since the launch of ChatGPT.”
From January 2023 to November 2025:
The finance and insurance sectors became even more AI-exposed, rising by about +5.7%. For several reasons, small businesses in these industries find it advantageous to increase staffing for AI-exposed roles in today’s environment, possibly evidence that AI is complementing workers in this sector.
The construction industry also edged upward (by about +3%), although it started from a very low base as one of the least AI-exposed sectors of the economy.
Key Takeaways from the Gusto Report
This mix of AI-exposed work has held steady. AI exposure went from 16.4% in January 2023 to 16.3% in November 2025. The early impact is happening within jobs—through new tools and workflows—not through sweeping changes in who gets hired.
More AI-exposed businesses are seeing revenue gains. A 10-percentage-point increase in workforce AI exposure predicts roughly 2.2% higher monthly revenue six months later—about $53,800 in additional annual revenue for a typical company.
There’s no evidence of overall job losses. Instead, businesses that were more AI-exposed had slightly more employees six months later.
Surge in Youth Entrepreneurship?
The Gusto report shows younger workers in AI-exposed roles may be getting squeezed out. While overall small-business employment grew 9.6% since January 2023, employment in highly AI-exposed occupations grew only 3.4%. Workers ages 22-28 saw a decline in headcount, while older workers gained.
As AI continued to automate routine tasks, employers seem to favor experienced workers who can exercise judgment and use AI to create business value. There is a silver lining, however. This could fuel youth entrepreneurship. Over half of Gen Z workers have a “side hustle,” and Gen Z entrepreneurs lead in AI adoption. Today’s labor market shifts may fuel tomorrow’s entrepreneurial boom.
Rieva Lesonsky is the founder of Small Business Currents, a content company focusing on small businesses and entrepreneurship. You can find her on Twitter @Rieva, Bluesky @Rieva.bsky.social, and LinkedIn. Or email her at Rieva@SmallBusinessCurrents.com.
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