The Daily Rundown

SMB News Daily Rundown: Update for November 5

Welcome to the Small Business Rundown. Each day, we bring you stories that impact small business owners and their workforce.

california-golden-gate-workest-sbdr

Small Business News Highlights for November 5: 

  • 751,000 Americans filed for unemployment last week
  • California’s AB5 law effectively negated by passage of Proposition 22
  • A chart depicting the COVID-related struggles of small business owners

Unemployment: 751,000 claims last week

“Bottom line, overall the labor market continues to repair itself but the pace at which it is doing so is slowing down.”

First-time applications for jobless benefits dropped slightly this week, with 751,000 new claims filed since last week. This represents the 3rd straight week that claims were below 800,000.

Continuing claims also fell by over 500,000 to 7.3 million, though economists note this number represents a portion of people who have exhausted their jobless benefits and must be migrated to other aid programs. Overall the total number of people receiving benefits fell by 1.15 million to 21.5 million — compared to the 1.44 million people who received benefits during the same time period last year.

California’s Prop 22 effectively negates AB-5 law

“Unemployed workers want as many options as possible to bring in money to their families. With a precarious economy, the economy in tatters and Covid continuing to surge, gig workers will rise to the forefront of many companies’ staffing choices.”

California residents voted in favor of Proposition 22 on Election Day, effectively negating the states AB-5 worker classification law enacted last year.

While the measure was supported by the deep pockets of tech companies like Uber and Lyft, it has real ramifications for other employers who rely on gig workers, as the U.S. economy’s shift toward contract work is accelerated by the pandemic.

COVID-19 continues to disproportionately hurt small businesses

“Given half of U.S. employment is in businesses with less than 500 workers and given the lower likelihood of additional fiscal support, this is a downside risk to nonfarm payrolls over the coming months, including tomorrow.”

The Bureau of Labor Statistics will release their October employment report tomorrow and the data is expected to show what small business owners know all too well at this point: the COVID-19 pandemic continues to take a disproportionate toll on companies with 500 employees or fewer.

The virus and the accompanying social restrictions inhibit consumer behaviors that favor small businesses, such as visiting coffee shops and restaurants or in-person shopping at local shops and boutiques.

Bookmark(0)

Might also interest you