Small-business owner confidence has gone into a tailspin. Perceptions of the economy among entrepreneurs have deteriorated for the third consecutive month — dropping by 9 points since July, according to the latest Job Creators Network Foundation Monthly Monitor poll .
It’s no surprise why. Going into Small Business Saturday, entrepreneurs are facing an avalanche of government-created obstacles that threaten their future.
Uncertainty over looming tax hikes and additional government red tape is throwing a wrench into future business plans. After new taxes and regulatory compliance costs, will there be room in the budget next year to cover facility upgrades, employee raises, and business expansion?
Meanwhile, high inflation spurred by out-of-control government spending is stretching business budgets further. Families are also feeling the financial pinch as they face a 30-year high for inflation going into the holiday season. It will inevitably translate to dwindling purchasing power and suppressed spending at small businesses.
What are policymakers in Washington doing about it? Spending more money. After recently passing the trillion-dollar “infrastructure” bill, a multi trillion-dollar budget reconciliation bill is next on the docket. Continuing to treat taxpayer dollars like monopoly money will push prices even higher. Fiscal responsibility is deeply needed.
But the White House doesn’t seem to be too concerned. President Joe Biden’s chief of staff endorsed a tweet in October arguing inflation is only a “high class problem.” The claim flies in the face of common sense. Middle-income and low-income households are hit harder by rising prices than the Jeff Bezos’s of the world. Quick tip: Keep extra wiggle room in your budget for Christmas shopping this year, as well as for travel expenses. Prices at the pump have jumped by nearly 50% since this time last year.
In parallel to rising prices, supply chain headaches are adding fuel to the already raging economic dumpster fire.
Pandemic-era government-imposed restrictions sparked a manufacturing slowdown. Now, as the economy picks up steam going into the holiday rush, factories and their parts suppliers are having trouble keeping up with demand. The intricate dance of a globalized supply chain can’t be turned on and off like a light switch.
Small businesses are among those shouldering the fallout. Unlike big box stores, smaller retailers don’t have as much inventory to spare to help bridge the supply deficit. For example, a modest-sized toy store that thrives between Thanksgiving and Christmas during a normal year may only depend on one or two shipments to keep the shelves plush. If those shipments are delayed, caught up in California ports, or stuck in a warehouse on the other side of the country, it’s game over.
Labor shortages are compounding these supply chain problems.
The latest federal government data reveal that nearly 2 million jobs remain unfilled in the transportation industry. That translates to fewer truckers, pilots, sailors, and other logistical personnel that help move goods from point A to point B. As a result, holiday gift shipments that do exist will be delayed, and shoppers will experience sparser shelves at the grocery store.
A new rule handed down by the Occupational Safety and Health Administration at the direction of the White House threatens to shrink the available labor pool further. The edict mandates workers to get the coronavirus vaccine if their business employs 100 or more people. Some of the small-business owners I’ve spoken to say they could lose up to 30% of their workforce as a result of the government mandate.
That’s why the Job Creators Network has filed a lawsuit to block it.
Small businesses usually thrive during the festive season as people search for unique items to gift family members and friends. But this year on Small Business Saturday, those presents will be pricier and more difficult to find thanks to government policies.
Elaine Parker is the president of the Job Creators Network Foundation.