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For Your Small Business July 30, 2019

4 Key Issues Facing Small Businesses Today

The first half of 2019 is already in the history books. For small businesses, it’s been a good year with a healthy economy and high job growth, although it has become increasingly challenging to recruit great talent due to lower unemployment.

Going forward, small businesses will be challenged to hold on to the economic gains of the first half of 2019 while keeping expenses and costs down. So, let’s take a look at some of the most important issues that small businesses will face in the months ahead.

1.      Search for talent given low unemployment levels

In a historically tight U.S. labor market, businesses are fighting to recruit the best candidates and talent. It is becoming especially important to invest in existing employees to reduce turnover. It costs far less to retain an employee than to hire one, and turnover can bleed a company dry through lost productivity, strain on other staff and the costs of recruitment and training.

2.      Guarding against onerous government regulations that hurt small business

Small businesses have to remain vigilant to oppose increasing governmental regulations wherever possible. The U.S. Chamber of Commerce Foundation finds that overly onerous regulations chokes off business growth, draining small businesses of funds:

Federal regulations … are growing and have a disproportionate impact on small business and free enterprise in America. Federal regulations alone are estimated to cost the American economy as much as $1.9 trillion a year in direct costs, lost productivity, and higher prices. The costs to smaller businesses with 50 employees or fewer are nearly 20% higher than the average for all firms.

3.      The minimum wage fight

There will continue to be city, state and federal legislative efforts to increase minimum wages at an accelerated pace, increasing labor costs for certain types of businesses while giving others an unfair competitive advantage.

On July 8, the U.S. House of Representatives passed a bill to hike the federal minimum wage to $15, but the Republican-held Senate is not expected to take up the legislation. This is the latest in a number of attempts to raise minimum wage that have left a patchwork of regulations across the country, according to CNBC.

The Congressional Budget Office projects that, if enacted, the federal wage hike could put nearly 1.3 million U.S. citizens out of a job, reduce business income, and raise prices as businesses would be forced to pass on higher labor coats.

4.      Need for more training programs

This is an area where governmental support can make a major difference for economic growth. The development of more apprenticeship and workforce training programs at the county, state, and federal levels will help increase employment opportunities with small businesses. Last month saw the latest announcement touting apprenticeship expansion providing new optimism this area will get much-needed focus and development.

Perennial Small Business Concerns

There are some eternal issues that small business will face in the years ahead. They range from anti-business legislative environments at all levels of government to the need for further overhaul of the federal tax structure. There is a continuing lack of workable lending sources to drive even greater investment in new and existing small businesses. Although these and other challenges remain, I’m confident that small businesses will continue to serve as a major economic engine for the U.S. in 2019 and beyond.

 

This article was written by Jeff Bevis from Forbes and was legally licensed through the NewsCred publisher network. Please direct all licensing questions to legal@newscred.com.

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