Small business owners show cautious interest in AI for payroll

A survey by OnTheClock of over 500 small and mid-sized business (SMB) owners and payroll decision-makers reveals a cautious interest in artificial intelligence for payroll management. While 65% of respondents are comfortable allowing AI to handle specific parts of the payroll process, only 11% trust the technology to take over the task entirely.

Common payroll errors include incorrect pay amounts (41%), miscalculated taxes (21%), late payments (18%), and missed payments (14%). These mistakes impact businesses through both financial loss and time consumption, with 45% of respondents reporting that errors cost them time in the past year.

Data shows that 68% of SMB owners, CEOs, and founders manage payroll themselves on a daily basis. For many of these leaders, the task is time-intensive; half report spending three or more hours per pay period on payroll, while 10% spend six or more hours.