Welcome to the Small Business Weekly Rundown. Each week, we bring you stories and trends that impact small business owners and their workforce.
Small Business News Highlights:
- Smallest small businesses have 2-week period to sign up for Paycheck Protection Program loans
- Republican lawmakers propose increasing minimum wage to $10
- NRF forecasts big jump in retail sales triggered by COVID-19 vaccine rollout
- Black-owned small business owners report cautious optimism about the future
- States scramble to protect unemployed from heavy tax burden
Smallest small businesses have 2-week period to sign up for Paycheck Protection Program loans
“This will give lenders and community partners more time to work with the smallest businesses to submit their applications.”
Starting today, for the next 2 weeks, only small businesses with 20 or fewer employees will be allowed to apply for loans through the Paycheck Protection Program (PPP).
While the data indicates that nearly 98% of United States small businesses meet this criteria, only 45% PPP funding has gone to these smallest of the small businesses.
This dedicated application period has encouraged many small business owners who have had trouble accessing funding during previous rounds of the Small Business Administration-run lending program. Other tweaks to the program enable sole proprietors, independent contractors, and self-employed workers to receive more money, and allow some business owners with felonies to now apply for aid.
Republican lawmakers propose increasing minimum wage to $10
“For millions of Americans, the rising cost of living has made it harder to make ends meet, but the federal minimum wage has not been increased in more than ten years.”
As Democrats debate within their own party whether or not to advance President Joe Biden’s $15 minimum wage increase, a few Republican senators have advanced their own proposal for increasing wages.
Senator Mitt Romney of Utah and Senator Tom Cotton of Arkansas have unveiled a plan that would increase the minimum wage from $7.25 to $10 per hour by 2025. Their proposal would index the amount to inflation every 2 years and also provides a slower phase-in time for businesses with fewer than 20 employees.
The proposal is not expected to receive broad bipartisan support.
A new nonpartisan report by the Congressional Budget Office found that raising the minimum wage would cost the country upwards of 1.4 million jobs yet lift 900,000 Americans out of poverty.
NRF forecasts big jump in retail sales triggered by COVID-19 vaccine rollout
“Our principal assumption is that that the vaccination will be effective and permits accelerated growth during the mid-year. The economy is expected to see its fastest growth in over two decades.”
Economists for the National Retail Federation (NRF) believe that the U.S. economy is about to see a huge boom as retail sales increase by 8.2% in the coming year.
While this prediction rests on the effectiveness and growing availability of COVID-19 vaccines, e-commerce sales are included in the NRF’s forecast after the public health crisis spurred a 22% increase in online sales.
Black-owned small business owners report cautious optimism about the future
“I don’t want to speak too soon, so I’m going to try to let this first quarter go by. If this continues, on into April, I’ll feel a little more comfortable about that.”
While Black and Brown small business owners faced a disproportionate amount of pandemic-related hardships and closures, a new survey found that Black SBOs are cautiously optimistic about the future.
According to the data, roughly half of Black SBOs believe that their business will generate more revenue this year and a quarter report that they have plans to hire new workers.
States scramble to protect unemployed from heavy tax burden
“There is a strong legal argument that none of the benefits authorized as part of the pandemic response are taxable.”
As Congress prepares to pass another COVID-19 relief package that would provide continued federal subsidies for unemployment benefits, many states are scrambling to pass legislation to protect unemployed workers from receiving an unexpected tax bill.
Unemployment payments are typically subject to income taxes, a fact that many people who have claimed jobless benefits are unaware of and many Americans have received tax bills that they are unable to pay.
The Latest from Workest
As you think about the strategic initiatives you want to implement for your business this year, take a minute to consider the Consequences of an Outdated Employee Benefits System. In this article, Grace Ferguson explores how neglecting your benefit management system can drain time and money and deter talent from joining your organization.
Speaking of attracting top talent for your business, Cinnamon Janzer explains why incorporating social responsibility issues into the workplace will help recruit Gen Z workers.
Finally, before we say goodbye for the week, here are 3 things you should know:
- As Congress debates raising the minimum wage, restaurant workers are wondering if we’re about to say goodbye to tipping.
- Curious how the challenges your business is facing stack up against other small businesses? Check out this list of the 10 Biggest Challenges facing SBOs.
- WalMart has announced that they will raise hourly wages to $19 per hour for nearly half a million workers starting March 13th.