The Federal Government must build on existing investment to support artificial intelligence adoption with greater focus on helping small businesses use AI safely and effectively and realise its productivity benefits, the Council of Small Business Organisations Australia (COSBOA) says.
The call follows new Treasury advice warning Australia risks missing the economic benefits of AI unless businesses move beyond basic adoption and make more significant changes to the way they operate.
COSBOA says Australia’s 2.7 million small businesses must be central to efforts to increase meaningful AI adoption, with targeted support needed to build awareness of how AI can be applied across different industries and improve AI literacy and capability.
Recent National AI Centre research found 43 per cent of Australian SMEs had adopted AI to some degree. COSBOA’s own research found just 14 per cent of small businesses had integrated AI into their business operations or services.
COSBOA CEO Skye Cappuccio said small business owners were well placed to embrace new technology, but faced very different barriers to larger organisations.
“Small business owners are adaptable and entrepreneurial. The problem isn’t a lack of willingness to innovate. It’s that they are incredibly time-poor and often don’t know where to start,” Ms Cappuccio said.
“Many are already experimenting with AI for things like social media and marketing, but that is very different from embedding it into business processes in ways that genuinely save time, reduce administrative burden and improve productivity.
“Commonwealth, state and territory governments have invested to varying degrees in programs to support small business AI adoption, and those programs have merit. But we haven’t yet seen the kind of concerted effort needed to shift the dial at scale.
“For many small business owners, AI still doesn’t feel relevant to their business. Others lack confidence in their ability to use it or are unsure whether they can use it safely,” Ms Cappuccio said.
“That is why small businesses need practical advice and guidance they can trust. That support needs to be relevant to their industry and their business, and genuinely designed to help them, rather than sell them a particular product.”
Ms Cappuccio said two immediate priorities should guide next steps: building awareness among small businesses of the benefits and practical applications of AI across different industries, and improving AI literacy and capability so businesses can use it in ways that drive efficiency.
“Large businesses are already investing heavily. They can hire specialist skills, develop their own AI tools and agents, train their staff and measure the productivity gains.
“Small businesses cannot be expected to make that transition in the same way or at the same pace without an initial hand to adapt.
“If we get this right, AI can help small businesses become more productive and competitive. If we get it wrong, we risk creating an even greater divide between large and small businesses.
“The Government’s own National AI Plan promised that the next phase of work would focus on helping small businesses scale their use of AI. We want to see that phase delivered, and funded, with awareness and AI literacy at its centre.”
COSBOA has previously called for policies that incentivise digital adoption by small businesses and for a light-touch regulatory approach that does not create additional barriers to businesses adopting transformative technologies such as AI.