A Glimmer of Hope for Small Businesses?
Small businesses are the backbone of our economy, generating 44 percent of U.S.
economic activity and employing half its workforce. With Inauguration Day here,
small business owners and entrepreneurs should be aware of how the new Biden
administration will affect them. Of course, the immediate concern is addressing the
pandemic effectively by providing relief with grants and loans. However, long-term
effects, such as tax increases, wages, and shifts in Chinese policy, will also make a
substantial impact. Here is what to potentially expect from the Biden administration if
you maintain a small business.
Battling the coronavirus is Biden’s #1 priority. More than 400,000 small businesses have
collapsed since the crisis began. Until the FDA-approved vaccine resolves this
tumultuous era, small business owners can expect new stimulus through the Paycheck
Protection Program (PPP). The Biden campaign promises immediate action to extend
relief to struggling small businesses and also plans to provide accounting and legal
advice, which may provide the much needed edge to compete with more prominent
MAIN STREET VS WALL STREET
Main Street is a colloquial term referring to small businesses as the polar opposite of
Wall Street. The new administration will likely shift focus from Wall Street’s economy to
Main Street, as stated in the Biden election campaign. The President-Elect plans to
increase individual and corporate taxes, but this increase will primarily affect large
corporations and citizens earning over $400,000/year, while 86% of small businesses
make less than $100,000.
● Research suggests no correlation between minimum wage increases and a rise
in business failures. If anything, the evidence leans towards the opposite.
● The China-United States trade war is likely to end with the new administration,
which would decrease production costs through outsourcing.
The new Biden administration brings a new sentiment of hope for small businesses and
entrepreneurs, especially in the form of short-term relief. However, more action can be
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