More Americans are starting businesses they plan to run alone. In the industries most exposed to AI, applications for businesses with no sign of hiring rose 26.8% between the first quarter of 2024 and the first quarter of 2026, while the same measure in construction and wholesale trade slipped 0.4%. CNBC reported the finding on November 7, citing a Mercatus Center paper by George Mason University researcher Liya Palagashvili.
What did the Mercatus study find about solo businesses?
The study found that solo-type business applications in AI-exposed industries grew 26.8% in two years, while employer-type applications in those same industries fell 6.4%. More people are filing to start companies in fields like consulting, finance and education, and fewer of those filings look like they plan to hire.
Palagashvili built the measure from Census Bureau Business Formation Statistics. She took total business applications and subtracted the "high-propensity" ones, the filings that show planned wages, hiring intent or a corporate structure. What is left is a proxy for one-person businesses. CNBC put the raw numbers at roughly 222,000 to 281,000 such applications per quarter.
| Measure (Mercatus, Q1 2024 to Q1 2026 unless noted) | Change |
|---|---|
| Solo-type applications, AI-exposed industries | Up 26.8% |
| Solo-type applications, construction and wholesale | Down 0.4% |
| Employer-type applications, AI-exposed industries | Down 6.4% |
| All applications, AI-exposed industries | Up 18.0% |
| Solo self-employment, AI-exposed industries (2022-23 baseline to 2025) | Up 7.9% |
| Solo self-employment, comparison industries (same period) | Down 2.1% |
The AI-exposed group is professional services, information, education, and finance and insurance, the four sectors with the highest AI adoption in Census survey data. The paper is careful about what it proves. Palagashvili calls the evidence "preliminary, descriptive, and not causal," so AI lines up with the jump but hasn't been shown to cause it. The paper itself came out in July; CNBC's report this week is what put it in front of business owners.
Why are more people starting businesses with no employees?
The owners CNBC interviewed say AI now covers work that used to need a hire: copy, product photos, bookkeeping, research and code. A solo owner can pay for software instead of payroll and keep the difference.
"What AI is doing is giving those capabilities directly into the hands of the individual," Palagashvili told CNBC. One seller in the piece runs 12 e-commerce brands that he expects to bring in $2.5 million to $3 million this year. Ruba Borno of AWS put it more simply: "Growth used to be tied directly to how many people you could hire."
CNBC also gave the other side. Existing small businesses that adopt AI often keep hiring, and the seller with 12 brands still gets about 80% of his revenue through Amazon. Going solo with AI can leave you leaning on a platform even more.
Does AI make small business owners more money or only save them time?
Mostly time, so far. In Bluehost's 2026 survey of 350 US small business owners, 78% said AI saves them time every week, but 43% of the AI users who answered the revenue question said their revenue hasn't changed since they started using it.
The Bluehost State of Small Business AI Confidence study, fielded in May 2026, found 39% did see a revenue lift, and only 6% said it rose significantly. Most owners use AI to write posts and emails faster. That frees up hours, and hours don't turn into sales on their own.
Who answers the phone when you run the business alone?
Usually nobody, at the exact moment a lead calls. A one-person business is on a job, driving, or on another call for most of the day, and a new lead who hits voicemail tends to call the next company on the list.
This is the gap I see most with solo operators. I've been running ads since 2013, and the ads are rarely what breaks first. The leads come in and sit there. If you want a number for your own business, plug your weekly missed calls and average job value into our free missed call calculator and see what a month of voicemail costs you. We've written more about the math in what missed calls cost a local business.
Get a front desk before you can afford a hire
KenjiAI gives a one-person business the pieces a receptionist would cover: Voice AI agents that answer, qualify and book calls, a chat and text agent for after-hours messages, and a CRM that keeps every lead and follow-up in one inbox. We've set this up for more than 500 businesses.
What should a solo owner do about this now?
Point at least one AI tool at revenue work, the steps between a lead showing up and a job getting booked, and not only at writing and admin. Those steps are where a business with no staff loses the most money.
- Count last week's missed calls and unanswered texts. Your phone carrier's call log is enough.
- Time how long a new web or ad lead waits for a first reply. Our speed-to-lead breakdown shows why minutes matter.
- Pick the one step you do worst, usually answering or following up, and hand that step to an agent first.
- After 30 days, check the result in booked jobs and closed sales, and ignore hours saved for this test.
If the Mercatus trend holds, more of your competitors will be one-person shops next year, and the jobs will go to whoever answers first. Start with step one this week.
FAQ
How much have solo business applications grown in AI-exposed industries?
A Mercatus Center paper by Liya Palagashvili found that applications for businesses with no early signs of hiring rose 26.8% from the first quarter of 2024 to the first quarter of 2026 in professional services, information, education, and finance and insurance. The comparison group, construction and wholesale trade, was down 0.4% over the same period.
Does the Mercatus study prove AI is causing more solo businesses?
No. The author calls the evidence preliminary, descriptive and not causal. The solo-business measure is built from Census data by subtracting likely employer filings from total applications, so it is a proxy rather than an official count.
Does AI increase revenue for small businesses?
For many owners, not yet. Bluehost's 2026 survey of 350 US small business owners found 78% save time every week with AI, but 43% of AI users who answered the revenue question saw no change in revenue, and 39% reported a lift. Owners who point AI at sales tasks have a better shot at the lift than those who use it only for admin and content.
How can a one-person business answer every lead?
Use an AI agent that answers calls and texts when you can't, qualifies the lead and books it onto your calendar. Pair it with a CRM that logs every conversation and follows up automatically so no lead waits for you to finish a job.
Originally published at kenjiai.com. Published by the Media Traffics | KenjiAI team.
