$93B SME AI Opportunity Proves Why Employment Hero Is Driving AI Adoption for Australian Small Businesses

Sydney, Australia, 22 October 2026 – Australian small and medium enterprises (SMEs) could unlock up to $93 billion in national economic value over the next five years and gain $136,000 annually per business through broader AI adoption. However, a new report by the Tech Council of Australia (TCA) reveals that only 1 in 4 SMEs currently use AI compared to 46% of large enterprises, with just 5% applying it across their broader operations.

Without deliberate action, Australia risks creating a “two-tier economy” where large businesses deepen their AI capabilities while SMEs, which employ 65% of the Australian workforce yet operate at 20% lower productivity, fall further behind. The regional gap is even sharper, with AI adoption sitting at just 16% in regional areas compared to 30% in metropolitan hubs.

As a Foundational Partner and primary sponsor of the TCA’s Accelerating AI Impact for Small and Medium Enterprises report, Employment Hero sat on the steering committee alongside Google and Deputy to help remove barriers for small business owners.

Researched by Delwood Advisory, the report synthesises key datasets, including Employment Hero’s Employment Uncovered research, which highlights the operational strains on business owners, such as the 48% of SME employees currently reporting burnout.

To bridge this gap, Employment Hero builds AI directly into everyday HR, payroll and recruitment workflows so business owners do not need to build or manage an AI stack from scratch. The TCA report profiles two specific Employment Hero AI use cases:

• AI-Led Recruitment: Associated with 45% faster hiring and onboarding.
• Automated Payroll: Associated with saving up to 36 hours a week in administrative tasks.

Ben Thompson, Co-Founder and CEO of Employment Hero, said: “Ask a small business owner what tasks consume their week and they’ll say payroll, super, awards and compliance. AI takes real weight off that pile. The report puts broad adoption at $136,000 a year for the average SME.

“We know because we’ve done it inside Employment Hero. Our product teams use AI to get through the roadmap faster, so customers get features months sooner. Our marketing team uses it to test and tune campaigns and web pages in days, not weeks. And AI agents now handle 95% of routine HR support questions, so our people spend their time on the hard ones. Specific examples like that are what an owner can copy this week.

“The report shows where owners get stuck. Many don’t know where to start, and regional adoption is about half the metro rate. You can’t demand change from an owner with no spare hours. Give them practical training, guidance and tools that work, especially in the regions and the sectors furthest behind. Lift small business productivity, and you lift the country’s.”

Addressing the core roadblocks identified in the report, including understanding, workforce skills and technical readiness, Employment Hero supports recommended government and industry actions to expand practical guidance, advisory services and targeted training for regional and low-adoption sectors.