# U.S. small businesses by the numbers, and what it means for AI > Federal data on America’s 36.2 million small businesses, how many use AI, and why most small firms should start AI with one well-chosen task. Canonical URL: https://www.whiteorange.com/insights/small-business-by-the-numbers-ai Published: 2026-10-13 Topic: AI for small business Author: The whiteorange team ## The short answer The SBA Office of Advocacy counts 36,207,130 small businesses in the U.S., 99.9% of all firms, and most of them have no employees at all. Census Bureau survey data from December 2025 to May 2026 shows overall AI use among businesses between 17% and 20%, with larger firms ahead. For most small firms, the practical move is to start AI with one task that saves real time. ## How many small businesses are there in the U.S.? According to the SBA Office of Advocacy’s February 2026 Frequently Asked Questions, there are **36,207,130 small businesses** in the U.S. Advocacy defines a small business for research purposes as an independent business with fewer than 500 employees. Small businesses make up **99.9% of all firms**. These counts are based on the Census Bureau’s 2022 business data, the most recent available for this measure. The bigger story is how small most of them are. Of those 36.2 million, **82.3% (29,811,495 firms) have no employees**. Census calls these nonemployer firms: sole proprietors, freelancers, and owner-run businesses. The remaining 17.7%, or 6,395,635 firms, have paid employees. Small firms also carry a large share of the economy. Advocacy reports that small businesses account for **45.9% of private sector employees (62.3 million workers)** and **43.5% of gross domestic product**. ## How many new businesses are starting? The Census Bureau’s Business Formation Statistics track applications for new employer identification numbers, a useful early signal of new business activity. For **August 2026, seasonally adjusted business applications were 531,728**, a decrease of 7.8% from July 2026. Not every application becomes an operating business, and many that do will stay small for years. Still, a steady flow of new firms means a steady flow of owners setting up their first systems, choosing software, and deciding how much to do by hand. That’s the moment when good habits are cheapest to build. ## What does South Carolina’s small business picture look like? The SBA Office of Advocacy’s 2025 Small Business Profile for South Carolina reports **530,402 small businesses**, which is **99.4% of South Carolina businesses**. Those firms employ **863,326 people, or 42.9% of South Carolina employees**. The profile draws on Census Bureau 2022 Nonemployer Statistics and Statistics of U.S. Businesses. In practical terms, most businesses across Greenville and the Upstate are small, owner-led companies. They feel the same pressure as everyone else to work more efficiently, usually without an IT department or a data team. ## How many businesses are using AI? The Census Bureau’s Business Trends and Outlook Survey (BTOS) asks businesses whether they used AI in the past two weeks and whether they expect to in the next six months. In a May 2026 analysis covering December 2025 to May 2026, Census reported that **overall AI use hovered between 17% and 20%**, and **between 20% and 23% of businesses expected to be using it in the next six months**. Census revised the AI question wording in November 2025, so older figures aren’t directly comparable. Size makes a real difference. Census reported that **37% of firms with at least 250 employees** said they used AI, while **less than 20% of firms with four or fewer employees** did. Over that period, AI use increased among firms with at least 20 employees but didn’t change significantly among firms with fewer than 20. In other words, most small businesses haven’t adopted AI yet, and the gap with larger firms is real. Small firms can often move faster than large ones once they know where to begin. ## What do these numbers mean for a small business owner? Put the figures together and a clear picture emerges. Most U.S. businesses are very small. Many are run by one person. Even among employer firms, the owner is often also the salesperson, bookkeeper, and IT help desk. Time is the scarcest resource. That shapes how AI should be approached. A large company can run a broad AI program with a dedicated team. A 12-person company can’t, and shouldn’t try. The better approach is narrow and specific. - **Pick one task** that eats hours every week, such as drafting quotes, answering routine emails, or summarizing job notes. - **Write down how it works today** and roughly how long it takes, so you have a starting point to measure against. - **Keep a person in the loop** to review AI output before it reaches customers. A short review checklist and a one-page AI use policy cover most of the risk. - **Decide after a few weeks** whether to keep it, adjust it, or drop it, then pick the next task. ## Where should a small firm start with AI? Start where the work is repetitive, text-heavy, and easy to check. Those tasks give the quickest return on your time with the least risk. Tasks that depend on clean data, such as forecasting or reporting, often need some groundwork first. That’s where [data and reporting](https://www.whiteorange.com/data-visibility) and [systems integration](https://www.whiteorange.com/systems-integration) come in. whiteorange works with small and mid-sized businesses the same way: understand how work gets done, improve one high-value problem with an agreed scope, then keep getting better. If you’d like a clear view of where AI could help your business, the free [Business Opportunity Assessment](https://www.whiteorange.com/audit) is a simple first step. It looks at your current processes and tools and points to the one or two places most worth your time. ## Common questions ### How many small businesses are in the United States? The SBA Office of Advocacy’s February 2026 FAQ counts 36,207,130 small businesses, 99.9% of all U.S. firms, based on the Census Bureau’s 2022 business data. ### What percentage of small businesses have no employees? According to the same SBA Office of Advocacy report, 82.3% of small businesses, or 29,811,495 firms, have no paid employees. ### What share of businesses use AI? Census Bureau BTOS data from December 2025 to May 2026 shows overall AI use between 17% and 20%. Use is higher at larger firms and below 20% at firms with four or fewer employees. ### How many small businesses are in South Carolina? The SBA Office of Advocacy’s 2025 profile reports 530,402 small businesses in South Carolina, 99.4% of the state’s businesses, employing 42.9% of the state’s employees. ## Sources - [Frequently Asked Questions About Small Business (February 2026)](https://advocacy.sba.gov/wp-content/uploads/2026/02/FINAL_FAQsAboutSmallBusiness_2026_012826.pdf), U.S. Small Business Administration, Office of Advocacy - [2025 Small Business Profile: South Carolina](https://advocacy.sba.gov/wp-content/uploads/2025/06/South_Carolina_2025-State-Profile.pdf), U.S. Small Business Administration, Office of Advocacy - [Business Formation Statistics, August 2026](https://www.census.gov/econ/bfs/current/index.html), U.S. Census Bureau - [Large Firms With at Least 20 Employees Biggest AI Users](https://www.census.gov/library/stories/2026/05/ai-use-businesses.html), U.S. Census Bureau whiteorange is a business improvement partner based in Greenville, South Carolina, with 25 years of experience. We help businesses find what matters, improve how work gets done, and keep getting better. Address: 914 Pendleton Street, Suite 300b, Greenville, SC 29601 Phone: 864.383.2278 Contact: https://www.whiteorange.com/audit Hours: Monday–Friday 8:30am–5:30pm; Saturday 12pm–4pm (Greenville local time). Website: https://www.whiteorange.com How we work: Understand → Improve → Grow. Service areas include Greenville, Anderson, Spartanburg, Greer, Travelers Rest, Easley, Powdersville, Clemson, Pickens, and Six Mile, South Carolina. whiteorange has one stated office in Greenville; service-area pages do not represent additional branches.