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With a brand new president, there are all the time modifications. Whereas a few of these concepts and proposals might sound perfect, they arrive at a value and the authorities should resolve how they are going to be paid for. Typically, the federal government turns to companies to assist fund these initiatives via new insurance policies or tax will increase, however what many don’t understand is that small companies can bear the brunt of those modifications.
Small companies are the spine of America. In reality, in keeping with the Small Enterprise Administration, there are greater than 30 million small companies within the U.S., and comprising 99.9% of all U.S. companies. Regardless of taking part in a key function within the financial system, lots of the proposed insurance policies presently being mentioned will hurt small companies in America. Let’s take a look at the primary of many insurance policies presently being mentioned in Congress.
A push for unions
From the start of his marketing campaign, President Biden declared, “I’m a union man.” So, it may well’t be an excessive amount of of a shock that his American Jobs Plan, which supposedly is about infrastructure, contains the Defending the Proper to Arrange (PRO) Act that was handed by the Home earlier this 12 months. The invoice would develop varied labor protections associated to workers’ rights to arrange and collectively cut price within the office. In reality, the positive print places workers in a predicament. Presently, greater than two dozen states have right-to-work legal guidelines in place that permit workers the choice to choose out of unions and never pay their dues. Beneath the PRO Act, unions can override the choice to choose out and power workers to pay union dues regardless of not wanting to hitch them.
How are small companies affected?
As with many new insurance policies, enormous companies have the funds and groups to fight almost any change that might doubtlessly hurt their enterprise. However, small companies usually don’t have the monetary skill to go up towards the powers at be. The financial system wants small companies to not solely survive however thrive within the post-pandemic world, and unions don’t assist their backside line. The PRO Act would make it tough to rent unbiased contractors, power corporations to subsidize union enterprise, and would make it tough to fireside substandard workers.
Is the President pro-big enterprise?
Whereas Biden claims to help small companies, lots of the insurance policies just like the PRO Act penalize small-business house owners whereas bigger companies stroll away comparatively unscathed. Small companies may be fragile, and extra rules and restrictions on high of the latest pandemic closures might end in fewer and fewer profitable small companies. In line with a brand new examine by the Federal Reserve, a further 200,000 companies closed prior to now 12 months because of the pandemic. Profitable small enterprise house owners are sometimes lumped into the identical class as billion-dollar companies who can higher soak up the elevated prices.
We want small companies to succeed now greater than ever to proceed to regain a robust financial system. To take action, the general public wants to grasp the attitude of those enterprise house owners, together with the struggles they’ve confronted within the final 12 months and Biden’s proposed insurance policies that might devastate them. We’ll proceed to debate these subjects and extra in my subsequent article on pandemic insurance policies that essentially discourage small companies.