2026 Industry Report
The State of AI in Small Business HR
Everyone is using it. Hardly anyone has a policy. Let’s close the gap.
If you’ve been using AI to help manage your workload, you aren’t "behind", you’re in the 80%. But if your business hasn’t written the rules for it yet, don’t worry, you’re also part of the 77% who also don’t have a formal policy.
At HR Partner, we wanted to look past the breathless tech headlines to see what’s actually happening in Small and Medium Businesses (SMBs). We surveyed HR professionals and business owners across the USA, UK, and Australia to find out how real teams, not just giant corporations, are handling Artificial Intelligence.
The Result?
A massive "Policy Gap" that is fast becoming a compliance risk in 2026.
Why This HR Report is Different
We didn't survey the Fortune 500. We focused on the "multi-hat" HR reality:
Key 2026 AI Trends for Small Business
The 80/23 Policy Gap
80% of HR professionals are now using AI tools to assist with their work, yet only 23% of businesses have a formal policy in place. With new AI workplace legislation being introduced globally, closing this gap is no longer optional—it's a compliance priority..
Accuracy Over Anxiety
The media loves a "robots taking jobs" story, but the reality is different. Only 10% of HR pros are worried about job loss. The real hurdles? Accuracy (65%) and Data Privacy (62%).
The Shift to HR Analytics
By the end of 2026, the biggest impact of AI won't be writing emails. HR Analytics (41%) was voted the #1 opportunity. SMBs are looking for ways to turn messy employee data into clear insights—without needing a data science degree.
Familiar Tools Win
Small businesses aren't buying niche software. They're leaning on what they know: ChatGPT (72%) for personal use and Microsoft Copilot (49%) for business integration.
Get the Insights You Need
We don't believe in hiding helpful info behind a landing page wall. You can read the full report right now. However, if you'd like a copy to read later or share with your team, we'll happily send a PDF version (complete with our AI Policy Templates) straight to your inbox.
Send me the PDF Report & Policy TemplatesAbout HR Partner
HR Partner is a purpose-built HR management system for growing teams with around 20-500 employees. Founded in Australia and used by organisations around the world, HR Partner brings all the essentials of HR into one simple platform, supported by real people with HR and recruitment experience.
Want to see it in action?
Frequently asked questions
It is the disconnect between the high usage of AI (80%) and the low rate of formal AI workplace policies (23%).
According to 2026 data, accuracy (65%) and data privacy (62%) are the primary concerns for HR professionals.
Most SMB HR pros (90%) do not fear job loss, instead viewing AI as a tool for efficiency and analytics.
ChatGPT and Microsoft Copilot are the dominant tools used by HR professionals in the UK, US, and Australia.