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Adopting AI could increase small business productivity by up to 133%

Adopting AI could increase small business productivity by up to 133%
Dan Martin
Dan MartinDan Martin Content & Events

Posted: Thu 17th Apr 2025

Small and medium sized businesses that use artificial intelligence (AI) tools could see the productivity boosted by as much as 133%, according to new research.

The St Andrews Business School study found that adopting AI results in productivity gains of between of 27% and 133%.

The analysis of the government's annual longitudinal small business survey (LSBS) of around 10,000 UK SMEs also found that it is firms with the lowest productivity levels which are most likely to adopt AI technologies.

Researchers said the benefits from AI adoption are sector specific with service businesses, such as catering and hospitality, particularly prominent among the beneficiaries.

Professor Ross Brown, who led the study, said:

Our findings are quite emphatic and show a clear-cut productivity premium for SMEs who adopt AI. Given the UK government's mantra about raising productivity levels, increasing AI adoption could potentially play a pivotal role at addressing the endemic problem of weak productivity in poorly performing SMEs.

"AI potentially offers SMEs "short cuts" that are easy to yield quick productivity "wins", such as planning staff rotas and reducing food wastage in a small restaurant, but are relatively inexpensive and easy to enact."

Related resources

Access technology advice, tips and tools via Enterprise Nation's Tech Hub

How government and business can partner to drive AI small business adoption

Webinar: Boost your productivity with AI

Dan Martin
Dan MartinDan Martin Content & Events
I'm a freelance content creator and event host who helps small businesses and the organisations that support them. I'm also Enterprise Nation's Local Leader for Bristol. I have 20 years of experience as a small business journalist having interviewed hundreds of entrepreneurs from famous names like Sir Richard Branson and Deborah Meaden to the founders behind brand new start-ups. I've worked for a range of leading small business publications and support groups, most recently as head of content at Enterprise Nation where I was responsible for the prolific output of content on the company's blog and social media. I now freelance for Enterprise Nation as the website's news reporter and as the host of the Small Business sessions podcast. I'm based in Bristol where I run and host regular events with the local small business community in my role as Enterprise Nation's Local Leader for Bristol. I also have strong connections with other major business organisations in the south west region. In total, I've hosted over 100 events including conferences with an audience of hundreds for international brands like Xero and Facebook and live web chats from inside 10 Downing Street. With my partner, I co-run Lifestyle District, a lifestyle blog focused on culture, art, theatre and photography.

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