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Preliminary research points to a shift in prospective businesses, not proof that AI caused it. Entrepreneurs describe how the tools let them take on work without building a staff.
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Preliminary Census-based research discussed by labor economist Liya Palagashvili found that quarterly business applications without early hiring signals in highly AI-exposed industries rose from about 222,000 to 281,000 between Q1 2024 and Q1 2026. Applications with stronger employer signals fell, but the measure does not show whether applicants stayed solo or whether AI caused the shift. For founders, the examples suggest AI can make outsourcing and hiring less necessary for some work, though businesses may still depend heavily on platforms for customers and sales.
Alex Willen runs 12 e-commerce brands without employees and expects them to bring in $2.5 million to $3 million in 2026.
Willen said AI replaced some product photography, design, bookkeeping and advertising expenses; a traditional product shoot previously cost $2,000 to $5,000.
FreshBooks found 86% of surveyed solopreneurs and micro-business owners tried AI before hiring outside help for a task they could not handle.
More Americans are applying to start businesses without early signs of hiring in industries highly exposed to AI. Those applications rose 26.8% over two years, according to preliminary research described by CNBC on November 7. Entrepreneurs’ accounts show how AI can support businesses without employees, but the research does not establish that AI caused the increase.
Alex Willen offers a concrete example of the economics. He operates 12 e-commerce brands with no employees and told CNBC he expects them to generate $2.5 million to $3 million in revenue in 2026. His use of AI spans both routine operations and work he previously bought from outside specialists.
Without those tools, Willen said he would probably need another full-time person, plus contractors for photography, design, bookkeeping and advertising. He put a traditional product shoot at $2,000 to $5,000 and new listing images from a designer at $300 to $1,000. When AI eliminates an expense, he said, he keeps the savings as profit.
The tools also helped him pursue sales he might otherwise have abandoned. Lone Trail’s Shopify site accounted for roughly 1% of sales when he acquired the brand. Rather than close it, he rebuilt it. In a recent 30-day period, he said, Shopify supplied roughly 30% of the brand’s revenue.
Kristin Ginn described a similar staffing choice in consulting. Seven months after leaving Microsoft in March and starting AI-adoption consultancy trnsfrmAItn, she had roughly $250,000 in business received or contracted through year-end. She has no employees or regular contractors, uses AI for proposals, pricing and strategy, and spends less than $60 monthly on paid AI tools.
The wider finding comes from research discussed by Liya Palagashvili, a labor economist at George Mason University’s Mercatus Center. Between the first quarters of 2024 and 2026, quarterly applications without early hiring indicators rose from roughly 222,000 to 281,000 in highly AI-exposed industries. Applications showing stronger signs of becoming employers moved in the opposite direction.
Applications without early hiring indicators increased in highly AI-exposed industries.
Applications with stronger indicators of becoming employer businesses declined.
Comparable applications declined slightly in the construction and wholesale trade comparison group.
Palagashvili cautioned that these are preliminary, descriptive findings. The Census-based measure captures applications lacking indicators associated with near-term payroll or hiring plans. It does not track whether the resulting businesses stayed solo or eventually hired. The increase therefore measures a change in applications, not a confirmed expansion of permanently employee-free businesses.
Older survey evidence helps explain why founders might try technology first. FreshBooks’ September report surveyed 500 solopreneurs and micro-business owners. It found that 86% turned to AI before hiring outside help when they encountered a task they could not handle. That figure covers both groups, rather than solopreneurs alone.
Among existing small businesses, however, AI adoption was associated with more employees. Payroll company Gusto found adopters had about 7% higher headcount after a year than comparable businesses that knew about AI but had not adopted it. Among firms with fewer than 10 employees, the difference was about 10%.
Staying small also leaves other dependencies intact. Roughly 80% of Willen’s overall revenue still comes through Amazon, while Ginn said LinkedIn has been a major source of customers. Stanford economist Erik Brynjolfsson argues that a proliferation of small producers can strengthen the platforms connecting them with buyers, even as entrepreneurs retain some productivity gains.
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