Artificial intelligence: a digital crutch
Artificial intelligence is firmly making its way into the world of employee benefits, but not always for the right reasons. For many SME leaders, tools such as ChatGPT are less a sign of innovation and more a symptom of missing support. Rather than being the best tool for the job, AI is often a stand-in for trusted advice, leaving leaders with more questions than answers.
AI use is widespread among SMEs
Leaders are turning to AI for a range of tasks – whether it’s researching competitors, drafting internal communications, or weighing-up the most cost-effective benefits. More than two thirds of respondents to our survey have used AI to make decisions about employee benefits, while 50% have used it more than once. For time-poor SMEs, the appeal is clear: AI offers quick answers, generates ideas on demand, and provides structure when dedicated HR expertise and advice is beyond reach.
Artificial advice
Have you ever used AI tools to make decisions about employee benefits?
Yes, once
Yes, more than once
Never
Unsurprisingly, not all leaders use AI equally. Younger respondents to our survey display the highest use of AI tools, with 25–34-year-olds the most frequent (83%), followed by 18–24-year-olds (76%). Older respondents were considerably less likely to have used AI to guide their decision making. Although this may reflect differences in generational attitudes to technology more broadly, it also underlines the potential for a future increase in AI reliance as younger, ‘AI-native’ employees graduate into leadership roles.
The scale of AI reliance among SME leaders is striking. But the data points to a concerning reality: decisions about complex, human-centred issues are increasingly being shaped by tools that can be superficial, inconsistent, and prone to bias. As a result, what feels like efficiency can easily deliver short-term fixes that fail to address employees’ real needs.
Jeff Fox, SME Strategic Consulting Lead
Convenience, but at a cost
But while SME decision makers are turning to AI, this isn’t translating into confident decision-making. Of frequent AI users, 77% indicate that they experience guilt about their benefits strategy either “sometimes” or “all the time”. Meanwhile, 40% of these same users believe their benefits package needs significant improvement — compared to just 9% of those who have never used AI. This suggests that AI is failing to fill the strategic gap.
Partly, this may speak to an underlying reality about AI technology: that it can only build on the information it’s given. If leaders’ prompts are narrow, generic, or incomplete, the recommendations they get in return will be equally shallow. Important considerations – such as whether benefits align with workforce demographics, or how usage will be measured – are unlikely to appear unless they’re explicitly requested. In this sense, AI tools mirror leaders’ blind spots, rather than correcting them.
But it also points to the fact that AI is no substitute for trusted guidance and advice. Instead of crafting long-term strategies, AI delivers surface-level outputs that lack the context, depth, and the nuance on which effective benefits depend. Leaders who rely on AI outputs risk treating symptoms, while overlooking and failing to address root causes. For employees, the consequences is a benefits package that may sound good, but which doesn’t hold up over the long term.
Searching for ideas
Leaders’ feelings towards their organisation’s benefits packages
Frequent AI users
Significant improvement needed
Some improvement needed
No real changes needed
Not sure
Never-AI users
Significant improvement needed
Some improvement needed
No real changes needed
Not sure