SMBs Rush Toward AI, But a Widening Skill Gap Threatens to Derail Progress

DUBLIN, Calif. – March 09, 2026 – Small and medium-size businesses (SMBs) are aggressively adopting artificial intelligence, but a stark and widening gap between their technological ambitions and workforce readiness could jeopardize their future growth and competitiveness. A new report reveals that while a significant majority of SMBs plan to increase their AI usage, very few feel prepared to develop or recruit the talent needed to manage this transition.

The survey, "The New Talent Playbook for Small and Midsize Businesses in the Age of AI," conducted by Harvard Business Review Analytic Services and sponsored by HR solutions provider TriNet, paints a picture of a sector at a critical inflection point. Among 230 U.S. business leaders, a staggering 76% expect their organization to increase its use of AI in the next 12 months. However, a mere 19% feel their organization is "highly prepared" to handle the associated talent demands, highlighting a significant capability gap.

The AI Adoption Paradox

The data underscores a fundamental paradox: SMBs recognize AI's transformative potential but are struggling to build the human infrastructure to support it. This isn't just about a lack of data scientists; it's a systemic challenge affecting training, role definition, and strategic planning.

According to the report, 56% of business leaders expect AI will force them to develop or train employees differently, while nearly half (49%) anticipate that the technology will reshape existing roles and responsibilities. The uncertainty runs deep, with 56% admitting they expect difficulty simply determining which AI skills their organization actually needs to prioritize.

"AI is fundamentally transforming the way SMBs operate," said Catherine Wragg, Chief People Officer at TriNet, in the press release accompanying the report. "This research underscores that while SMBs are moving swiftly to embrace AI, many are still navigating the best ways to equip their people for this new era." Wragg noted that this presents an opportunity to "reimagine workforce strategies, planning, and skill development."

This rapid, sometimes reactive, adoption aligns with broader industry trends. A 2025 report from the U.S. Chamber of Commerce found that 98% of small businesses now use some form of AI-enabled software. Other studies show adoption rates climbing steadily, with some suggesting up to 90% of SMBs are now integrating AI into their operations, often leading to measurable success for those who get it right. Yet, the preparedness gap found in the HBR study suggests many may be deploying tools without a coherent strategy for maximizing their value or managing their impact on the workforce.

A New Premium on Human Skills

Ironically, the rise of artificial intelligence is pushing human-centric skills to the forefront. The survey reveals that the greatest demand isn't necessarily for coders, but for people who can effectively work alongside AI. A full 70% of respondents report that AI is driving the need for talent with distinctly human capabilities such as creativity, intuition, and critical discernment.

This shift points toward a future of human-AI collaboration rather than simple automation. Businesses are realizing that AI tools, while powerful, require human oversight, ethical judgment, and industry-specific context to be deployed effectively. Qualities like emotional intelligence and sound judgment are becoming foundational requirements to ensure AI serves business goals without introducing new risks or alienating customers.

The most in-demand technical skill, cited by 55% of leaders, is practical experience using AI tools to accomplish work tasks. This suggests a focus on applied AI—empowering employees across all functions to leverage AI for productivity—rather than theoretical expertise. This is reflected in the real world, where SMBs are using AI assistants to handle customer service inquiries, optimize marketing campaigns, and automate bookkeeping, often boosting productivity by up to 40%.

The Upskilling Imperative

Despite the clear benefits, the path to an AI-integrated workforce is fraught with challenges. The survey highlights a palpable sense of pressure, with 79% of leaders agreeing that AI is driving an urgent need to upskill their existing talent. Yet, knowing what to do and actually doing it are two different things.

Nearly half of the respondents (49%) anticipate difficulty in training or upskilling their current employees on AI, and 37% expect to struggle with simply evaluating the AI skills and experience of job candidates. This creates a bottleneck, where the desire to innovate outpaces the ability to execute. This challenge is compounded by a "trust gap" identified in other industry reports, where employees may be hesitant or anxious about adopting new technologies, even while business leaders push for faster integration.

The economic stakes are high. SMBs that successfully navigate this transition report significant gains, with some studies indicating that 91% of AI-adopting SMBs see measurable revenue growth. Conversely, those that fail to bridge the skill gap risk being outmaneuvered by more agile competitors. The inability to effectively leverage AI could stunt productivity, limit innovation, and ultimately erode market share.

For the backbone of the American economy, this is more than a technological challenge—it is a strategic one. The findings suggest that the most successful SMBs in the coming years will be those that view AI not just as a tool to be implemented, but as a catalyst for investing in their most valuable asset: their people. They must foster a culture of continuous learning and prioritize the development of both technical fluency and irreplaceable human skills to thrive in the age of AI.