{
  "id": "F-31",
  "url": "https://evy.so/facts/what-stops-small-companies-adopting-ai/",
  "chapter": "Small Teams",
  "question": "What stops small companies from adopting AI?",
  "answer": "Mostly the belief that AI does not apply to them: 54 to 63 percent of US firms under 50 employees with no AI plans say so, and 57 percent of non-adopting SMEs in seven OECD countries. Lack of knowledge and privacy worries come next, at about one in five each; cost is cited by 6 to 16 percent.",
  "range": {
    "low": 54,
    "high": 63,
    "unit": "% of small firms with no AI plans that say AI does not apply to their business",
    "display": "54–63% of small firms with no AI plans say AI does not apply to their business"
  },
  "confidence": "high",
  "confidence_reason": "Three independent creators with different methods agree that 'does not apply to us' leads by a wide margin. The ranking of the smaller barriers is less stable, because answer lists differ and one survey asks only firms that had considered AI.",
  "last_checked": "2026-10-14",
  "how_to_read": "Each source asks a different group. The Census Bureau and the Federal Reserve ask firms with no plans to use AI; the OECD asks non-users; Eurostat (below) asks only non-users that had considered AI, which is why its shares run much higher. Across creators the order holds: AI seems irrelevant, then knowledge gaps and privacy worries, with cost and regulation minor for small firms. Small firms cite privacy less often than large ones (20% against 30% in the Census data).",
  "sources": [
    {
      "creator": "US Census Bureau",
      "title": "BTOS AI Supplement Table 2026",
      "year": 2026,
      "sample": "More than 117,000 responding US firms, November 2025 to February 2026",
      "method": "Official survey of firms not planning to use AI in the next six months; several answers allowed",
      "figure": "AI not applicable: 63.3% (1 to 4 employees) to 58.1% (20 to 49), 42.2% at 250+; lack of knowledge 21 to 23%; privacy 20 to 22%; too expensive 6.7 to 7.3%",
      "url": "https://www.census.gov/hfp/btos/downloads/AI_Supplement_Table_2026.xlsx",
      "quote": "AI is not applicable to this business"
    },
    {
      "creator": "Federal Reserve Banks",
      "title": "2026 Report on Employer Firms (2025 Small Business Credit Survey)",
      "year": 2026,
      "sample": "1,855 US employer firms with no plans to use AI, September to November 2025",
      "method": "Weighted convenience sample; several answers allowed",
      "figure": "AI not applicable: 54% to 60% by size band under 50; prefer not to use it 21 to 33%; cost 6 to 16%",
      "url": "https://www.fedsmallbusiness.org/reports/survey/2026/2026-report-on-employer-firms",
      "quote": "AI is not applicable to my business"
    },
    {
      "creator": "OECD, survey by Ipsos",
      "title": "Generative AI and the SME Workforce",
      "year": 2025,
      "sample": "SMEs not using generative AI, from 5,232 surveyed in seven countries, late 2024",
      "method": "Random telephone survey weighted by number of firms",
      "figure": "Not suited to the company's work 57.3%; legal or copyright concerns 54.1%; data concerns 52.5%; staff lack skills 49.8%; value for money 21%",
      "url": "https://www.oecd.org/en/publications/generative-ai-and-the-sme-workforce_2d08b99d-en/full-report/component-6.html",
      "quote": "The most common reason for not using generative AI is that it is not suited"
    }
  ],
  "related_findings": [
    {
      "question": "What stops small firms that have looked into AI?",
      "answer": "Expertise, legal uncertainty and data worries. Among EU firms with 10 to 49 employees that considered AI and did not adopt it, 71% cite lack of expertise, 55% unclear legal consequences, 52% data protection worries and 39% cost (2025). But only about 1 in 8 small EU non-users had ever considered AI, so as shares of all small firms these are 4 to 7%.",
      "sources": [
        {
          "creator": "Eurostat",
          "title": "Artificial intelligence by size class of enterprise (dataset isoc_eb_ai)",
          "year": 2026,
          "sample": "EU enterprises with 10 or more employees, 2025 survey",
          "method": "Official statistics; asked only of non-users that had considered AI",
          "figure": "Small firms that considered AI: lack of expertise 70.87%, legal uncertainty 54.79%, data protection 52.49%, cost 38.82%; 12.65% of small non-users had considered AI",
          "url": "https://ec.europa.eu/eurostat/databrowser/view/isoc_eb_ai/default/table",
          "quote": "Enterprises do not use AI technologies, because of a lack of relevant expertise"
        }
      ]
    },
    {
      "question": "Do most small firms face barriers to AI at all?",
      "answer": "Many say they do not. In the UK in June 2026, 52% of businesses under 10 employees and 42% of those with 10 to 49 reported no barrier to adopting AI, and no single barrier reached 14% among firms with 10 to 49 employees. In Canada, 41% of businesses with 1 to 4 employees say AI is not relevant to them.",
      "sources": [
        {
          "creator": "Office for National Statistics (UK)",
          "title": "Artificial intelligence in UK businesses: 2023 to 2026",
          "year": 2026,
          "sample": "38,637 responding UK businesses, June 2026",
          "method": "Official statistics in development; barriers in the last three months",
          "figure": "No barriers: 51.6% (0 to 9 employees), 42.0% (10 to 49); expertise 7.0% and 13.3%; cost 6.5% and 11.3%",
          "url": "https://www.ons.gov.uk/businessindustryandtrade/business/businessservices/articles/artificialintelligenceinukbusinesses/2023to2026",
          "quote": "41% of UK businesses with 10 or more employees report no barriers to adoption."
        }
      ]
    }
  ],
  "numbers_you_may_have_seen": [
    {
      "claim": "Cost is the biggest barrier stopping small businesses from using AI.",
      "what_the_source_says": "Official surveys don't support it: cost is cited by 6.7 to 7.3% of small US firms with no AI plans (Census) and 6 to 16% (Federal Reserve). It ranks high only among EU firms that had considered AI."
    },
    {
      "claim": "70.89% of EU companies cite lack of expertise as the main barrier (2025).",
      "what_the_source_says": "70.89% is Eurostat's 2024 value shown under a 2025 label; the 2025 value is 70.31%. It is asked only of non-users that had considered AI. As a share of all EU enterprises, lack of expertise is 7.8%."
    },
    {
      "claim": "Census: 65% of businesses say AI is not applicable to them.",
      "what_the_source_says": "That appears in a working paper's text. Its own chart and the published table give 61.6% of firms not planning to use AI."
    },
    {
      "claim": "Lack of skills is the top barrier for SMEs.",
      "what_the_source_says": "True in Japan and Korea and among EU firms that considered AI. Across the seven OECD countries and in US official data, the top reason is that AI does not fit the business."
    }
  ],
  "citation": "EVY (2026). What stops small companies from adopting AI? The AI at Work Fact Book, F-31. https://evy.so/facts/what-stops-small-companies-adopting-ai/ (last checked October 14, 2026). CC BY 4.0.",
  "license": "CC BY 4.0"
}