Researchers at the John J. Heldrich Center for Workforce Development are currently engaged in a project with the New Jersey State Policy Lab to examine how New Jersey’s artificial intelligence (AI) initiatives can better align with the evolving needs of small businesses. This blog post offers an examination of the study’s progress, underlying research processes, and future developments.
While the previous blog post presented a broad review of the literature on small businesses and AI, the Heldrich Center’s study has a narrower scope of interest, focusing on one county for deeper exploration. Middlesex County, New Jersey was selected as the case study. To gain a clearer understanding of the county’s current economic landscape, U.S. Census Bureau data were analyzed to assess its industry composition and business patterns.
For the purposes of this study, small businesses are defined as firms with fewer than 100 employees. Accordingly, the analysis focused on the number of firms in each industry within this categorization. The industries with the highest concentration of small businesses within Middlesex County include Professional, Scientific and Technical services, followed by Healthcare and Social Assistance, Retail Trade, and Accommodation and Food Services. To further examine the county’s labor market, a workforce analysis was conducted for the two industries with the highest concentration of small business firms utilizing data from Lightcast. In the Professional, Scientific, and Technical Services industry, Middlesex County demonstrates higher employment levels and greater racial diversity than the national average. Employment in this industry is concentrated primarily in computer and mathematical services, business and financial services, and management work. In the Healthcare and Social Assistance industry, labor demand in Middlesex County is lower than the national average, though racial diversity remains comparatively higher. Employment in this industry is concentrated largely among healthcare practitioners, healthcare support workers, and office and administrative support roles.
The labor market analysis provides valuable insight into Middlesex County’s workforce landscape and the potential ways AI may interact with the county’s most commonly observed occupations in the industries with the highest concentration of small businesses. To assess the potential impacts of AI on these key industries and occupations, the project is utilizing an AI risk measure developed by Anthropic, which estimates observed AI exposure (Massenkoff & McCrory, 2026). The AI exposure assessment will provide an understanding of what occupations are likely to see the most exposure to AI within the industries that have the highest concentration of small businesses in Middlesex County.
The next phase of the project involves collecting qualitative data through focus groups with small business owners and/or managers in Middlesex County in order to gain more in-depth knowledge around uses and perceptions of AI. Findings from the upcoming focus groups will provide key learnings to an underexplored research topic and help identify areas in which small businesses can benefit from additional support as they increasingly engage with AI.
It is important to acknowledge several considerations and limitations associated with this research. First, the project defines small businesses as those with fewer than 100 employees. However, other key factors such as a firm’s revenue and asset holdings can also strongly influence a firm’s experience and ability to successfully adopt AI (Garapati, 2024; Oldemeyer et al., 2024). Due to data limitations, these measures could not be incorporated into the project’s analysis of industries and occupations. As a result, underlying differences in revenue and financial resources among small businesses in Middlesex County may not be fully captured in the findings. While these limitations should be considered when interpreting the findings, this study provides an important foundation for understanding how AI may shape the experiences of small businesses in Middlesex County and, more broadly, across New Jersey.
As AI continues to reshape industries and workplaces, understanding how small businesses experience and respond to these changes is increasingly important. By combining quantitative labor market analysis with qualitative insights from small business owners, this project offers a more comprehensive view of both the opportunities and challenges AI presents for small firms. In doing so, the study contributes meaningful insight that can inform future research, workforce development strategies, and policy efforts aimed at supporting equitable and effective AI adoption among small businesses.
References:
Garapati, S. (2024, March 18). Poll shows small businesses are interested in and benefit from AI. Bipartisan Policy Center. https://bipartisanpolicy.org/article/poll-shows-small-businesses-are-interested-in-and-benefit-from-ai/.
Massenkoff, M., McCrory, P. (2026). Labor market impacts of AI: A new measure and early evidence. Anthropic. https://www.anthropic.com/research/labor-market-impacts.
Oldemeyer, L., Jede, A., Teuteberg, F. (2024). Investigation of artificial intelligence in SMEs: A systematic review of the state of the art and the main implementation challenges. Management Review Quarterly, 75, 1185-1227. https://doi.org/10.1007/s11301-024-00405-4.