White House in 2016: What's on the Horizon for Small Business?

Business.com / Legal / Last Modified: February 22, 2017

With the presidential elections coming approaching, hopefuls are wooing small business. What are they promising, and what's impactful?

Don’t expect grassroots experience with small business to be the hallmark of any presidential candidate this election cycle.

The field looks to be overweight in bureaucrats with the remaining contenders having cursory associations with small business-like concerns. They will be taking their cues from what’s already in the hopper and will be looking for direction from small business owners across the country as they hit the campaign road in 2016.

According to the SBA, small business accounts for over half of all employment in the US. Most (half) have 1-4 employees, are in retail trade with another 20% in the services industry. Another important demographic to consider is those employers with 50-100 employees accounting for almost 9 million workers. From a voting perspective, these workers probably don’t want their hours cut back due to ACA triggers and artificially increased wages.

Small business will be big business for 2016 presidential candidates as there is much to be won, particularly by Democrats, by cozying up to the small business owner. In recent surveys, almost 40% of small business owners gravitate to the Republican Party, while only 22% support Democrats—that pretty much says it all.

So, let’s look at what these folks need to be saying to woo the small business owner to their camp.

JOBS actImage via Forbes

I need funding, NOW! (Jump Start Our Business)

The SEC has been slow to complete and enact this legislation in regard to easing various securities regulations to help small businesses obtain capital from investors, specifically crowd funding (Title III). We know FFF (friends-family and fools) but the JOBS Act will expand the reach of capital acquisition to get your business up and running.

Basel III is also on the horizon and could squeeze banks even more on liquidity and capital levels making loans even scarcer. While scheduled to move forward in October of this year, challenges still exist for the JOBS Act and there are several more important provisions unattended to—why the wait? This is sort of securities deregulation, typically not appealing to Democrats.

Related Article: SBA Loan Myths: Demystified

How can I get a juicy government contract?

Doing business with the government is frustrating and time consuming. Many small businesses rely on, or could flourish with simpler processes, fewer requirements and more open communications with procurement, and most avoid pursuing this water shed of revenue or game the affirmative action system.

It is very difficult for these companies to economically bid on these contracts. Look for candidates promising a pull back of special diversity programs and a reduction in the bureaucracy around landing these profitable jobs.

Affordable Care ActImage via Wyoming Public Radio

Affordable Care Act 

Small businesses in general want these coverage triggers repealed or adjusted. For businesses already in the sweet spot (50-100 employees) the message is clear, reduce your numbers, their weekly hours or pay for health coverage, an impossible feat for many of these businesses.

For those that have fewer employees, while not immediately impacted, the dream of growing your business becomes questionable. Repeal of the law is on the table, but not likely. Look for candidates who want to change the law in ways that eliminate coverage mandates while keeping premiums reasonable.

Minimum Wage

Minimum wage issues are a red herring for small business. Fewer than 1.5 million workers are paid minimum wage in the United States today, but this platform item has many facets, so be careful. Almost 60% of small businesses support the minimum wage increase and here’s why—the prevailing wage proposals are $10.10 an hour and many of these businesses are likely already at that level or higher.

Some candidates (R) don’t like minimum wage requirements at all while others would like to see a “living” wage. Yes, there is a difference with some proposals around $15 per hour. There are also side effects that may push the worker out of government programs by making too much, requiring even more pay to make up the difference. However, as it stands this is just a “look at me” I care about the worker…at $10.10 an hour.

Related Article: Boys Vs. Girls: The Difference Between Affirmative Action and Discrimination

Marketplace fairnessImage via Human Events

Market Place Fairness Act – Online Sales Tax

Be careful of this legislation. With setup of online commerce available to everyone, you too can reach across state lines to expand your business. Ten years ago this was likely a real issue but technology has moved us beyond that and tax fairness defers to a matter of scale.

There is little we can do there as big box retailers are going to have a better pricing environment, it is simply a market force. At this point in our evolution this is just another tax grab for government, so if you don’t like that, don’t vote for it!

Right to Work (or not)

Many small businesses are not affected by organized labor, but some, such as a small auto-parts manufacturer, could be impacted greatly by the presence of workforce participation in labor unions. A states right, many states have enacted or are enacting right to work laws that specifically empower the employee to make this choice rather than leaving them with no alternative.

Organized labor places extreme pressure on these businesses, the same pressures seen with mandated “living” wages and ACA mandates. Usually a partisan issue, with the Democrats supporting organized labor, look for candidates on both sides to put this choice back in the workers hands.

It’s a little early to assess which candidates or hopefuls will remain in the running but let’s look at the assumed top four from each of our main parties. Not much has been stated or promised yet, but we can take the temperature of things that have been stated in passing.

ISSUEIN FAVORAGAINST
JOBS ActBi-partisanDemocrats will slow it down
ACA

Hilary Clinton (D)
Bernie Sanders (D)
Martin O’Malley (D)
Lincoln Chafee (D)

Marco Rubio (R)
Ted Cruz (R)
Rand Paul (R)
Jeb Bush (R)
Jim Webb (D)
Chris Christie (R)

Minimum/Living Wage

Hillary Clinton (D) ($15)
Martin O’Malley (D) ($10)
Bernie Sanders (D)
Jim Webb (D)

Marco Rubio (R)
Jeb Bush (R)
Rand Paul (R)
Ted Cruz (R)
Chris Christie (R)

Marketplace Fairness Act

Hillary Clinton (D)
Bernie Sanders (D)
Martin O’Malley (D)
Lincoln Chafee (D)
Jeb Bush (R)
Chris Christie (R)

Marco Rubio (R)
Rand Paul (R)
Ted Cruz (R)

Right to Work

Marco Rubio (R)
Rand Paul (R)
Ted Cruz (R)
Chris Christie (R)

Hillary Clinton (D)
Martin O’Malley (D)
Jim Webb (D)


We see these top issues for small business in 2016, many of which have been in the mix for years and could potentially be resolved even before election time. Take a look and see how each candidate is trending on issues important to you, and cast your vote!

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