Inflation, labor shortages and economic uncertainty continue to challenge small businesses, but a new ShareBuilder 401k study suggests many owners are no longer responding only with defensive moves. Instead, they are adapting, investing and looking for tools that can help them do more with limited resources.
That should matter to MSPs, because the research points to a small business market that is under pressure but still willing to spend where technology can improve productivity, strengthen operations and support growth. The opportunity is not simply to sell more tools, but to become a more strategic partner to customers that are trying to navigate cost pressures, staffing constraints, AI adoption and long-term business planning at the same time.
Here’s the reality: 88% of owners have taken action over the past year to address inflation and labor pressures, up from 78% in 2024. Not surprisingly, half have increased prices to protect margins, while others have moved to lower-cost vendors or increased employee wages. It’s also logical that inflation remains the leading concern, as expressed by 62% of owners as a top issue for the year ahead.
For MSPs, those numbers reinforce the idea that, while small businesses are cost-sensitive, they are not standing still and are actively looking for ways to preserve margins, improve efficiency and make better decisions. That creates a clear opening for technology providers that can connect IT services to business outcomes rather than presenting them as another operating expense.
The AI findings are particularly notable. While much of the broader discussion around artificial intelligence centers on workforce disruption, small business owners view AI differently. Nearly three-quarters (72%) see AI as a tool that supports staff and improves efficiency, rather than a replacement for workers. In fact, only 9% see AI as a replacement for employees and 70% believe AI integration will help them hire additional employees in the future.
That outlook creates a valuable positioning opportunity for MSPs. Many small businesses are interested in AI, but interest does not automatically translate into successful adoption. Owners may experiment with AI tools for marketing, customer service, administrative work, reporting or decision support, but they often lack the internal expertise to evaluate security, compliance, data quality, workflow integration and employee training – areas where AI can significantly improve efficiency and drive growth.
That’s where MSPs can deepen customer relationships. Rather than treating AI as a standalone product category, providers can frame it as part of a broader operational modernization strategy. For example, an MSP could help customers identify repetitive processes, evaluate safe and appropriate AI tools, create policies for acceptable use, secure sensitive data and integrate AI into existing collaboration, CRM, accounting or customer support platforms.
The survey shows that AI is already producing measurable value for small businesses, with 75% of owners saying AI saves them time each week and 63% say they rely on AI insights to guide business decisions. But, 21% also cite AI integration as a top concern for the year ahead, presenting a gap between perceived value and implementation complexity is exactly where MSPs can build advisory-led services.
Naturally, this could create new recurring revenue streams. AI readiness assessments, workflow automation projects, employee training, data governance, security reviews and ongoing optimization services can all become part of a managed AI offering. In fact, SMBs probably need more help in this space because they have fewer internal resources and much smaller budgets to manage technology change than their enterprise counterparts.
Labor presents another opportunity, considering 76% of business owners say hiring is difficult right now, even when offering competitive pay and benefits, with a third pointing to labor costs and the ability to hire and retain the right employees as top concerns. That means small businesses are not simply looking for technology that works; they are looking for technology that gives existing employees more capacity.
MSPs can respond by helping customers make better use of the systems they already have. Many small businesses underutilize their productivity suites, communications platforms, cloud storage, cybersecurity tools and line-of-business applications. Process automation, better endpoint management, secure remote access, improved collaboration workflows and smarter use of data can all help businesses stretch limited teams further without sacrificing quality or security.
What’s truly important here is this changes the nature of the MSP sales conversation. A customer struggling with labor shortages may not initially ask for automation, AI policy development or collaboration optimization. But, those may be the very services that help the customer reduce administrative burden, improve responsiveness and free employees for higher-value work. MSPs that understand the business pressure behind the technology need are better positioned to expand beyond traditional support.
It’s also important to note the cautious optimism evident in the survey. Despite concerns about market volatility, 68% of small-business owners report increased confidence in their business outlook compared to last year. Many are planning on making investment designed to drive growth, including 58% in marketing and sales and 40% in AI solutions. So, while businesses are still watching costs, many are preparing to invest in growth.
What these numbers mean collectively is MSPs that approach the market only with break-fix support, basic infrastructure management or security fear messaging will miss the larger opportunity. The more compelling message is that technology can help small businesses operate more efficiently, compete more effectively and make smarter decisions despite economic pressure.
This report offers a roadmap for where customer conversations are headed. Inflation is forcing owners to protect margins. Labor shortages are pushing them to increase productivity. AI is creating both enthusiasm and uncertainty. Long-term planning is becoming more urgent.
Each of those pressures creates a reason for business owners to seek help, and MSPs that can translate those needs into practical, secure and measurable technology strategies will be well positioned to deepen relationships, expand recurring revenue and move from IT provider to essential business partner. In other words, MSPs must that take a hands-on consultative approach with customers, instead of simply selling individual services.
Edited by
Erik Linask
