Welcome to the Small Business Rundown. Each day, we bring you stories that impact small business owners and their workforce.
Small Business News Highlights for July 15:
- The fate of small businesses in question as pandemic drags on
- The argument for getting rid of the salary history question
- Tourist town SBOs feeling the pinch without foreign seasonal workers
How much longer can SMBs hang on?
“We’re seeing the whole business landscape dramatically undergo massive changes and one part of this is how large companies with resources will take advantage of the troubles, travails, and financial problems small companies have.”
The coronavirus pandemic has rapidly — and perhaps, permanently — altered the reality of work around the world. As more ramifications of these changes unfold, however, it’s becoming increasingly clear that bigger companies have the upper hand over small businesses when it comes to basic survival.
The federal government has made it possible for large corporations to borrow $3 trillion worth of cash at rock bottom rates, while Congress’ sole effort to prop up small businesses, the Paycheck Protection Program, has been riddled with flaws and shortcomings from the beginning.
In fact, 22% of small business owners that received PPP funds reported that they will soon have to lay off at least one employee, if they haven’t done so already.
Not asking about pay history is beneficial for Black employees, women
“An employer voluntarily deciding to stop asking about salary history represents a deliberate, specific action that can help reduce pay inequity and, for first movers, serve as a brand boost to make the company a more attractive employer to women and minorities, showing that the employer is actually taking concrete steps to combat institutional discrimination.”
For businesses serious about dismantling systemic inequalities and race-based injustice in the workplace, doing away with questions about salary history during the hiring process offers a good place to start.
The Harvard Business Review recently examined the research around asking candidates about their salary history and found that places that have laws against asking for pay history resulted in a 13% pay increase for Black candidates.
Women also benefit from getting rid of pay history requirements, with 8% of female applicants seeing an increase in their salary.
While some HR professionals argue that the question is necessary to gauge useful information about the candidate, the research shows that an overall culture of transparency is much more beneficial for all parties.
Tourist towns feel the pinch without foreign seasonal workers
“Any seasonal resort area or seasonal business that you can think [of] in whatever part of the country has really been hurt terribly hard by this.”
If contending with the coronavirus isn’t enough, many small business owners in the hospitality industry are struggling to keep up without the help they received from temporary seasonal workers.
Last month, the Trump Administration announced that it was extending a freeze on green cards and other types of visas, leaving the beach town employers who depend on foreign students each summer in the lurch.
The extended ban applies to J-1 cultural exchange visas and H-2B visas, which often go to workers who support everything from the forestry and fisheries industries to the hospitality sector.