Come January 20th, Joe Biden will officially be President of the United States.
It’s been a long road for Biden. He fought extremely hard beginning well over a year ago as he entered the crowded scene at the Democratic primaries.
As he begins to prepare to take over the most powerful position in the United States, and possibly the world, you might be wondering what’s to come for your small business.
A Verizon Small Business Survey showed that 84% of people were concerned with what the election would mean for their business, regardless of who won.
Understanding some of the biggest concerns that small business owners like you have and some of Biden’s plans will help you know exactly what’s in store for your business over the course of the next four years.
Biggest Concerns
To know exactly how policies Biden plans to enact will affect your small business, it’s important to take a look at exactly what small business owners are concerned with.
In a survey similar to the one mentioned above, over half (55%) said that they were concerned about their ability to continue conducting business while implementing social distancing regulations and limiting their business capacity.
Two thirds of businesses are showing declining sales numbers, and 92% of business owners are concerned about the general economic effects of the coronavirus.
Still, 72% of small businesses are optimistic about the next few months and are confident that they will be successful going forward.
Biden’s policies plan to help both small business owners and employees, but it will be interesting to see the effects of some of his health care and tax reform plans.
Health Care
Health care has always been one of Biden’s main talking points, and he will now have to prove to America that his plans for health care will work.
He is a strong supporter of having a low-cost public option available to all Americans, which would be good for small business owners, because it will help lower the costs of private insurance as well as influence some people to choose the public option.
Over the course of the last four years, health care costs have steadily risen by 6 to 8% every year, but expect private health care costs to remain more stagnant throughout Biden’s presidency, or even become far lower should the government pass a federal public health care for everyone.
Either way, you should expect to save some money on employee health care.
Funding for Entrepreneurs
Biden is a warrior for entrepreneurs; unlike our current President, he does not have personal experience in business, but he understands the costs associated with small businesses and wants to see regulatory costs go down.
Too many small businesses have unnecessary costs associated with licensing, and Biden wants to see these costs disappear.
He also has proposed billions of dollars to local small businesses that operate within communities that are declining, so you might expect to be eligible for tax credits or federal grants depending on what your business does and where you operate.
Minimum Wage
One policy that has the potential to hurt your small business is planned hikes for the minimum wage.
Some companies simply don’t operate on margins that make it easy to pay a minimum wage of $15, and it will be difficult for these companies to quickly adapt to paying all their employees at this wage depending on the timeline for this policy.
Supporters of Biden hope the $15 minimum wage is enacted quickly, but the timeline is still unclear.
Either way, if your small business is currently paying employees at wages below $15, it might be time to start thinking about ways you can cut costs in order to pay the new minimum to your employees.
You might even have to raise wages past this amount in order to make your wages competitive amongst a quickly changing labor market.
Tax Reform
Some of Biden’s larger plans require huge amounts of federal funding. If public health care is provided to all Americans, you will save money on health care, but the government will have to raise trillions of additional dollars in tax revenue in order to pay for the health care, and some of that will have to come from small businesses.
Though Biden wants to avoid having small businesses pay higher amounts in taxes, it will be difficult to see how this is prevented due to the fact that he plans to raise the corporate tax rate from 21 to 28%.
He also plans to impose higher ordinary and capital gain tax rates on more wealthy individuals, which shouldn’t affect your small business but may affect those who make over $400,000.
Since Biden doesn’t want to see a large increase on small business taxes, you might see additional deductions being allowed compared to what has been allowed in the past.
Coronavirus
The biggest issue for most American voters is the COVID-19 pandemic. This is a huge reason why Biden won the election; too many Americans disapprove of what was done to tackle COVID under President Trump.
Now that Biden is president, he has to choose whether or not the country should close down again or if new regulations need to be implemented to protect Americans from contracting the disease.
If cases continue to rise and become more dangerous, we may see another shutdown of the country which would be difficult for small businesses everywhere.
However, Biden has said that he doesn’t want to go this route; instead, he plans to fund higher amounts of PPE for workers around the country to help employees stay safe while being able to continue working.
Final Thoughts
The next four years will be a time for huge changes in the United States. The last year has been unlike anything the country has ever seen, and rapid changes and problems are not slowing down any time soon.
As Biden takes the over the mantle as president, and the economy continues to return, you should look forward to years of prosperity which are to come.
