Prompt engineering: A crucial skill for small businesses?

As the job market evolves, a new skill is quickly gaining momentum: prompt engineering. This specialized ability to craft effective prompts for AI systems is transforming how businesses operate, especially small companies that need an edge over the competition.

In this article, we’ll look at the importance of prompt engineering for small businesses and its benefits and challenges, according to business owners. We’ll also list the top-paying U.S. cities for this in-demand skill. Whether you’re a small business owner looking to learn prompt engineering or a job seeker curious about this emerging field, this analysis has helpful insights to guide you.

Key takeaways

Over one in four small business owners (27%) say that prompt engineering is a very important skill for their business.
52% of small business owners would offer prompt engineering courses/training for prospective employees who are a good fit but lack experience in this area.
36% of small business owners are more likely to hire someone skilled at prompt engineering than other candidates.
On average, prompt engineering skills pay U.S. workers $113,294. Companies in San Jose and San Francisco, CA, pay the most: $170,396 and $150,814, respectively.

Summary/Overview

Levels

Small business views on prompt engineering skills

Small businesses are recognizing the growing importance of prompt engineering, but adoption rates vary; some companies have yet to fully embrace this emerging trend.

The impact of prompt engineering on small businesses

Over one in four small business owners (27%) said that prompt engineering is a very important skill for their business. Owners of larger businesses were twice as likely to say the same (54%). Still, 28% of small business owners said they had never used prompt engineering. Larger businesses were also 2.4 times more likely than smaller companies to use prompt engineering daily.

Prompt engineering can be used for all sorts of business areas, including marketing content creation. Descriptive prompts can help you search Adobe Stock for specific images or spark creative ideas for base images and design elements in Photoshop and Illustrator. Prompts can also help video makers create intros or storyboards using AI visuals. Social media creators can also prompt AI tools with certain keywords or a desired mood to craft graphics or short video concepts.

Top five benefits of prompt engineering for small businesses

In the U.S., certain AI tools are sparking more interest than others when it comes to prompt searches. A closer look reveals which platforms are really capturing people’s imaginations.

We asked small business owners about the key benefits of prompt engineering for their operations. These were their most common responses:

Increasing operational efficiency by optimizing AI interactions to perform tasks more quickly and accurately (46%)
Enhancing the quality and relevance of outputs from AI systems, improving decision-making and customer interactions (35%)
Reducing the need for manual intervention, allowing staff to focus on more complex and value-added activities (33%)
Providing a competitive edge by enabling more sophisticated use of AI technologies (23%)
Facilitating personalized customer experiences through tailored AI responses (19%)

Top five challenges of prompt engineering for small businesses

Small business owners also shared the primary challenges they face when implementing prompt engineering:

Requiring continuous learning and updating of skills to keep pace with AI advancements, which can be resource-intensive (44%)
Facing uncertainty about long-term use as the field of AI continues to evolve rapidly (33%)
Dealing with initial setup and training can be costly and time-consuming, requiring significant upfront investment (24%)
Struggling to integrate with existing systems, potentially leading to compatibility and operational issues (23%)
Finding employees who are skilled prompt engineers is challenging due to the specialized nature of the skill (22%)

Hiring and training for prompt engineering

As small business owners recognize the value of prompt engineering, they’re finding different ways to quickly learn and apply these skills across their teams. Many are also looking to hire talent already well-versed in prompt engineering.

Small business owners' opinion on prompt engineering skills

Nearly half of small business owners (48%) have learned prompt engineering independently, while 52% are ready to provide training or courses to new employees who fit the role but lack experience. This emphasis on prompt engineering extends to hiring, as over a third (36%) of owners are more inclined to hire candidates with these skills.

Prompt engineering can elevate branding and communication across different marketing channels, making it a great tool for any business’s arsenal. For example, prompts can guide the creation of scripts and visuals that clearly explain products or services, helping content creators make standout explainer videos. They can also spark inspiration for eye-catching designs that capture a brand’s identity, helping designers create distinctive brand assets and business logos.

Top-paying cities for prompt engineers

Prompt engineering skills are in high demand across the U.S., commanding strong salaries in various regions. However, some cities have emerged as top-paying hubs for this growing field.

Prompt engineering skills have earned competitive salaries nationwide, averaging $113,294 per year as of May 2024. The highest-paying cities were largely concentrated in California, led by San Jose ($170,396) and San Francisco ($150,814). Four of the top five highest-paying cities for prompt engineering were in California, with New York City rounding out the group. Among the 50 most populated U.S. cities, Jacksonville, Florida, has recently paid the least for prompt engineering: $73,553 annually.

Investing in prompt engineering

Prompt engineering is becoming increasingly important for businesses, especially small ones. With its growing impact on operations, small business owners can make informed decisions about investing in this skill and finding the right talent by understanding both the benefits and challenges. As AI technology advances, mastering prompt engineering can set small businesses apart, helping them gain a competitive edge in the marketplace.

Methodology

We surveyed 1,002 business owners to see the importance of prompt engineering in their business operations. Of the respondents, 73% were micro business owners, 13% were small business owners, 8% owned medium businesses, and 6% owned large businesses. For this study, we grouped small and micro businesses together as “small” (86%) and grouped medium and large businesses together (14%). We conducted the survey from May 1-5, 2024.

We also scraped 1,517 job postings on Indeed and filtered for “prompt engineering” in 50 major U.S. cities to explore how salary varies by location for jobs requiring this skill. We used the following steps to determine average salaries:

Extracted numeric values: Identified all numeric values in the salary string, which could be a single number or a range (e.g., “$3,000-$3,500 per month”).
Calculated the average of the range: If the salary was provided as a range, we calculated the average. For example, for “$3,000-$3,500 per month,” the average would be $3,250.
Apply the multiplier for hourly, weekly, and monthly salaries: We multiplied hourly rates by 2,080, monthly by 12, and weekly by 52.