Small business technology adoption: a compiled report

Small business technology statistics show that nearly every small firm uses digital tools, that cloud software is common, and that advanced technologies like AI and robotics are still concentrated in larger companies. The gap is less about whether firms use technology and more about how many tools they use and how well those tools work together.

This report draws on two kinds of sources. The Census Bureau's Annual Business Survey (ABS) is a large, nationally representative survey of U.S. firms, analyzed in a Census technical report and an NBER working paper. The U.S. Chamber of Commerce's annual small business technology reports, produced with Teneo Research, survey small businesses directly about the platforms they use. The Census data is more rigorous but older; the Chamber data is more recent but publishes less on method.

Nearly all of them. The Chamber's 2024 report, published in September 2024, found 99% of small businesses use at least one technology platform, such as tools for payments, communication, accounting or marketing. Its 2026 report found 41% use six or more platforms, up 9 points from 2025 and nearly three times the 2022 level.

Plans point upward. In the 2024 report, 81% planned to increase their use of technology platforms. In the 2025 and 2026 reports, 84% said the same. The Chamber also reported in 2026 that businesses using two or more platforms were roughly 10 points more likely than low-tech businesses to report growth in sales, profits and employment. That is a correlation in survey data, not proof that technology caused the growth.

Very common, according to the most detailed government data. NBER Working Paper 28290, by Zolas, Brynjolfsson, McElheran and Census Bureau colleagues, analyzed the 2018 Annual Business Survey, which covered more than 850,000 firms and asked about 2017 activity. Among firms that collect business information, 90.2% stored at least one type digitally. Among firms that perform IT functions, 78.4% bought at least one cloud service, though only about a quarter bought cloud services for all of their IT functions.

Financial and personnel records were digitized most often. Supply chain information was least often used intensively, at about 32.6% of firms. Cloud adoption rose with firm size, and among the smallest firms (one to nine employees), younger firms were more likely to use cloud services than older ones.

Yes, strongly. The NBER authors found advanced technology adoption is skewed toward larger and older firms. AI use or testing ranged from 5.3% at the smallest firms to 62.5% at firms with 10,000 or more employees.

Because large firms employ so many people, workers are more exposed to these tools than firm counts suggest. The Census technical report on the same survey found robotics was used by 1.0% of firms but by firms employing 6.8% of workers. Touchscreens were used by 4.5% of firms and reached 13.2% of employment. Machine learning was used by 2.2% of firms and reached 5.4% of employment.

More recent Census survey data shows the same size pattern for AI, which we cover in our separate report on small business AI adoption.

Information, manufacturing and health care led the 2018 survey. In the NBER analysis, the information sector had the highest rate of digitized records, at 96.5% of firms that collect information, and about 89% for cloud services. For advanced technologies, manufacturing led at about 15%, followed by health care at 14%, information at 12%, education at 11% and professional services at 10%. Transportation and warehousing, retail and other services were among the lowest for digitized records, at 85% to 88%.

For service businesses, the health care figure stands out. Practices and clinics have long used digital records and scheduling systems, often because of insurance and regulatory requirements, which gives them a head start on newer tools.

Mainly to make their processes more reliable. The Census Bureau's September 2025 story on the 2023 Annual Business Survey, which covers 2020 to 2022, found that improving the quality or reliability of a process or method was the top reason for adopting cloud technology (51.8% of adopters), specialized software (49.8%) and AI (45.8%). For specialized equipment, the top reason was improving the quality or reliability of goods or services.

Firms rated their established tools as most important. In 2022, 59.0% of cloud adopters called cloud technology very important, as did 58.9% of specialized software adopters. AI was more often rated somewhat important, at 58.0%. AI had the highest recent adoption timing of any technology measured, with 68.0% of AI adopters starting in 2021 or 2022.

Not according to the survey data. The Census Bureau reported that most businesses saw no overall change in headcount after adopting AI, specialized software, robotics, cloud technology or specialized equipment between 2020 and 2022. For most of these technologies, adopters were more likely to report an increase in workers than a decrease. For robotics, 9.5% reported an increase and 8.1% a decrease, a difference Census called not statistically significant.

Skills shifted more than headcount. AI was the technology most often cited as improving worker skill levels, and 22.1% of AI adopters said it boosted STEM skills. Only 3.3% of AI adopters reported lower worker skill levels.

The gaps are in depth of use more than in basic adoption. In the NBER analysis, about three in four firms bought some cloud services, but only about a quarter used the cloud for all of their IT functions. Most firms digitized financial records, but intensive digital use of supply chain information reached only about 32.6% of firms. In other words, many businesses have moved part of their operation online and kept the rest on paper, in email or in someone's memory.

For a service business, that partial picture often looks like an accounting system and a payment tool in the cloud, alongside scheduling, intake forms and client notes kept in separate places. Each part works, but reports have to be stitched together by hand.

Ambition is high. The Chamber's 2024 report found 77% of small businesses planned to adopt emerging technologies, including AI, and 91% of businesses actively using AI expected it to help them grow. The risk the data points to is adding new tools on top of incomplete ones. A business that has not finished moving its core records and workflows into dependable systems will get less from anything layered on top.

The Chamber's 2025 report includes state results. For South Carolina, it reported 60% of small businesses use an AI platform, 52% use generative AI chatbots and 86% believe AI will help their businesses in the future. The Chamber does not publish state sample sizes on its site, so treat these as indicative.

The data suggests most service businesses do not need more tools. They need the tools they have to work together and to support reliable processes. A real estate brokerage with a CRM, a separate e-signature tool, a marketing platform and a spreadsheet for commissions is typical of the 41% using six or more platforms. Each tool may work fine on its own while the handoffs between them create errors and double entry.

Monvell's Platform and Consulting work starts by mapping the tools a business already uses and where information is retyped or lost, then recommends what to connect, replace or retire.

• List every software tool your team uses, who owns it and what it costs.
• Mark where the same information is entered in more than one place.
• Identify which tool holds the main customer record, and make the others feed it.
• Retire tools that overlap or that fewer than two people use.
• Add new technology only when it fixes a specific, measured problem.