Welcome to the Small Business Run Down. Every day, we bring you stories and trends that impact small business owners and their workforce.
Today, we look at small businesses bracing for a recession, the mixed reactions of SBOs toward new government policies, and a review of FICA caps for 2019. Finally, we wade into the age-old men vs. women debate–with a twist. Hold on to your hats!
Bank of America released a survey finding that more than two-thirds of American business owners are preparing for a recession. The survey showed a decrease in optimism from last year and indicated that the rising cost of healthcare and the prospect of trade wars concern SBOs. The survey also found that only 19% of business owners have an open line of credit to use when hard times hit.
The Number: 69%. According to a recent survey by Bank of America, 69% of US small business owners have started preparing for a recession by setting cash aside or reducing business expenses.
The Quote: “When you need a line of credit, you often can’t get one. Business owners should be thinking about that now.”
Heading into National Small Business Week, many economists and business owners are evaluating the impact of new federal policies on small businesses. The response to the current administration’s regulatory and tax policies remains mixed. Though small businesses make up the backbone of the economy, there’s no such thing as a “typical” small business and companies have vastly different structures, needs and priorities. As such, government policies impact SBOs differently.
The Number: 21%. Under new tax law, the maximum corporate tax rate dropped from 35% to 21%, though the rate actually went up for many small corporations.
The Quote: “It’s been one step forward and one step back. A lot of the positive gains we’ve seen out of tax reform have been given back in lost sales and lost opportunities because of higher tariffs.”
Did recent reports about the future of Social Security pique your curiosity about the Federal Insurance Contributions Act (FICA)? If you–or your employees–have questions, check out this overview of 2019 Social Security payroll tax limits.
The Number: 2.8% The cost of living adjustment for Social Security tax is an increase of 2.8% from 2018 to 2019.
The Quote: “The Social Security payroll tax cap is one number that is adjusted annually that every employer with a payroll needs to pay attention to at the start of every new year to make sure they’re deducting the correct amount of taxes from their employees.”
A recent survey out of Australia found that male entrepreneurs have a more difficult time dealing with the administrative and bureaucratic stress of running a business than their female counterparts. The survey found that in addition to being more resilient, women entrepreneurs are also more likely to sacrifice their own health for the sake of the company. Now the only question left to ask is: are Australian women or American women tougher?
The Number: 41%. When asked if the stresses of running a company were killing the dream that caused them to go into business in the first place, 41% of women responded “yes,” compared to 51% of men.
The Quote: “Such resilience is likely having a negative impact on the health of these women though, with 53 percent of respondents saying they would sacrifice their wellbeing when under pressure, compared to 47 percent of men.”