Nearly one-third (31%) of UK small businesses admit they are reluctant to implement AI despite recognising its potential benefits, according to new research by hiring platform Indeed.
The hesitation around adopting AI is hindering growth opportunities, particularly in efficiency gains that could propel these businesses forward.
The report, which surveyed 1,000 leaders of small businesses across the UK, found that while 41 percent are eager to integrate AI into their operations, many are unsure how to begin. This uncertainty is exacerbating the challenges faced by small enterprises, which make up 99.2 percent of the UK’s business landscape.
Employee Resistance and Owner Anxiety Fuel AI Reluctance
Many business owners worry about the risk AI might pose to their operations. Nearly 40 percent said they prefer sticking to familiar methods, fearing that mistakes or mishandling AI could damage their reputation. Employee resistance is also a factor, with 26 percent reporting direct pushback from workers. A third (33%) of businesses struggle to get employees on board with AI use, while 43 percent express concerns over unauthorised use of AI by staff.
Business owners, feeling the weight of their company’s success on their shoulders, often view AI adoption as a risk they cannot afford. Nearly 40 percent stated that the business depends too heavily on them to take a chance on new technologies like AI.
Small Businesses at a Disadvantage
Smaller firms face unique hurdles when it comes to adopting AI compared to their larger counterparts. Almost half (48%) of respondents feel they cannot compete with bigger businesses in this space, citing the financial strain of integrating AI systems. However, many recognise that AI could help reduce costs in the long run, with 41 percent seeing potential for cost savings through AI implementation.
Despite these perceived challenges, 49 percent believe that AI could take their business to the next level by streamlining processes, freeing up time for strategic planning, and driving innovation. Some even suggest that AI could lead to a four-day work week, with 24 percent saying the time saved could make this a reality.
Demand for Simple, Accessible AI Solutions
Small business owners are clear about what they need to overcome AI hesitancy. 40 percent are seeking easy-to-use AI tools, while 29 percent want AI features integrated into the products they already use. Many are also looking for external support, with 29 percent calling for AI integration consultations and 26 percent hoping for government grants to ease the financial burden.
To address these concerns, Indeed and Small Business Britain are continuing their “People for Business” initiative, offering support to small businesses. This includes a free webinar to guide firms through the process of implementing AI and unlocking its benefits.
Industry Leaders Urge Action on AI Adoption
Caroline Barbour, Senior Marketing Manager for SMB at Indeed, emphasised the importance of AI adoption for small businesses: “Small businesses are the backbone of the UK economy, and it’s vital that they have the tools and support to grow. While many are nervous about adopting AI, they also recognise the transformative potential it holds. Our ‘People for Business’ program aims to provide small firms with the resources they need to confidently integrate AI and thrive.”
Michelle Ovens CBE, founder of Small Business Britain, echoed this sentiment: “AI represents one of the biggest shifts for businesses today. While the fears are understandable, small businesses must embrace this change to stay competitive. With the right guidance and support, they can seize the opportunities AI presents.”
AI: The Path to Growth and a Better Work-Life Balance
Despite fears, there is optimism about AI’s potential. Many small business owners believe that automating routine tasks could lead to a more meaningful work environment, with 43 percent saying AI could make work more enjoyable. One in three (35%) believe it would improve their work-life balance, and nearly as many (31%) expect it to boost job satisfaction.
As small businesses weigh the pros and cons, one thing is clear: AI could play a critical role in their future success, provided the right tools and support are in place to make it accessible and effective.
Amelia Brand is the Editor for HRreview, and host of the HR in Review podcast series. With a Master’s degree in Legal and Political Theory, her particular interests within HR include employment law, DE&I, and wellbeing within the workplace. Prior to working with HRreview, Amelia was Sub-Editor of a magazine, and Editor of the Environmental Justice Project at University College London, writing and overseeing articles into UCL’s weekly newsletter. Her previous academic work has focused on philosophy, politics and law, with a special focus on how artificial intelligence will feature in the future.
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