NFIB Weekly News
Leading the News
Small Business Optimism Near All-Time High. (12/12/2017)
The NFIB indicated that small business optimism in November reached a level not seen “since the roaring Reagan economy” in 1983. NFIB President and CEO Juanita Duggan is quoted saying, “We haven’t seen this kind of optimism in 34 years, and we’ve seen it only once in the 44 years that NFIB has been conducting this research. ... Small business owners are exuberant about the economy, and they are ready to lead the U.S. economy in a period of robust growth.” The Small Business Optimism index for November increased by 3.7 points, “a sharp increase over what was already a near-record performance the previous month.” NFIB said, “Eight of 10 components posted gains, including a stunning and rare 16-point gain in Expected Better Business Conditions and a 13-point jump in Sales Expectations.” NFIB Chief Economist Bill Dunkelberg is quoted saying, “The NFIB indicators clearly anticipate further upticks in economic growth, perhaps pushing up toward four percent GDP growth for the fourth quarter. This is a dramatically different picture than owners presented during the weak 2009-16 recovery. ... The change in the management team in Washington has dramatically improved expectations.”
Senate Passes Tax Bill That Would Repeal ACA’s Individual Mandate Penalty.
The New York Times (12/2, Tankersley, Kaplan, Rappeport, Subscription Publication) reported that early on Saturday morning, the Senate passed “the most sweeping tax rewrite in decades...with Republicans lining up to approve an overhaul that will touch almost every corner of the United States economy, affecting families, small business owners and multinational corporations, with the biggest benefits flowing to the highest-earning Americans.” The measure was passed along party lines, by a vote of 51-49.
The Washington Post (12/2, Goldstein) reported that the bill “would reach deep into the nation’s health-care system, with a clear dagger to a core aspect of the Affordable Care Act and broader ripple effects that could threaten other programs over time.” The measure would abolish the penalties the government imposed on those who lack health care coverage.
Business Owners, Consumers Across The Country Deem Small Business Saturday A Success.
Coverage of Small Business Saturday – both in advance of the day itself, encouraging people to participate, and afterward, summing up views from local customers and small business owners – was very extensive, with media outlets both large and small publishing stories about the shopping holiday. The Los Angeles Times (11/25, Wigglesworth) reported that President Trump “signaled his support for Small Business Saturday in a tweet sent Saturday morning.”
USA Today (11/24, Layne) reported that “Small Business Saturday has become less about big profits and more about building community and educating shoppers about the small merchants in their own backyards. Last year, shoppers spent an estimated $15.4 billion at independent retailers and restaurants on the day, according to a survey conducted by the National Federation of Independent Business for Amex. That was a decrease from the estimated $16.2 billion in 2015.” Tom Lowenburg, the owner of an independent bookstore in New Orleans, said, “Small Business Saturday really does do something to connect with our community. It’s not about manipulating people, or putting them in an uncomfortable situation, but creating a genuine shopping experience that comes from the kinds of relationships we already have with our customers.”
Trump Tweets “Flake(y)” Will Oppose Tax Cuts, Urges Senate GOP Not To Disappoint Public.
The AP (11/19) reported President Trump issued “an insulting tweet” against Sen. Jeff Flake Sunday night after the lawmaker “was caught on an open microphone Friday saying the GOP is ‘toast’ if the party follows Trump and Alabama Senate candidate Roy Moore.” Trump tweeted, “Sen. Jeff Flake(y), who is unelectable in the Great State of Arizona (quit race, anemic polls) was caught (purposely) on ‘mike’ saying bad things about your favorite President. He’ll be a NO on tax cuts because his political career anyway is ‘toast.”’
NFIB Backs Amended House Ways And Means Tax Reform Bill.
Bloomberg News (11/9, Niquette) reported, “Business groups applauded committee passage of the House bill to overhaul the U.S. tax code, including the National Federation of Independent Business, which reversed its initial opposition to the measure.” The NFIB “raised concerns that early provisions in the bill involving limited-liability companies and other ‘pass-through’ entities didn’t help small businesses,” but it “backed changes made in an amendment by Ways and Means Chairman Kevin Brady before the committee approved the bill on Thursday.” NFIB CEO Juanita Duggan was quoted saying, “We are very grateful to Chairman Brady for listening to our concerns and working with NFIB to ensure that tax reform benefits the greatest possible number of American small business owners. ... This amendment would create substantial tax relief for millions of small-business owners who were left out of the original bill.”
Small Business Optimism Stays Strong In October.
According to the NFIB’s latest Small Business Optimism Index, small business owners increasingly said last month that they expect higher sales and view the present as a favorable time to expand. NIFB Chief Economist Bill Dunkelberg said, “Owners became much more positive about the economic environment last month, which suggests a longer-run view. ... In the nearer term, they are more optimistic about real sales growth and improved business conditions through the end of the year.” The 103.8 October Index, an increase from the previous month’s 103 Index, continues a months-long positive streak dating to last November, following the presidential election. Four of the Index components rose, five saw a slight decline, and one was unchanged. Dunkelberg said, “We expect a pickup in auto spending as people in Texas and Florida continue to replace cars that were damaged in the hurricanes. We expect the same increase in home improvement spending, partly because of the hurricanes, but also because of the skyrocketing price of homes.”
Trump Says Tax Bill “Getting Closer And Closer,” But Analyses Say Much Work Remains. (12/12/2017)
President Trump touted the Republican tax plan in a Sunday morning tweet, writing, “Getting closer and closer on the Tax Cut Bill. Shaping up even better than projected. House and Senate working very hard and smart. End result will be not only important, but SPECIAL!” In addition, House Majority Leader McCarthy expressed optimism about a vote by the end of next week. However, coverage and analyses focus on the substantial differences between the House and Senate versions, pointing out that there is a lot of work to be done in a short time.
NBC Nightly News (12/10, Snow) reported, “Members of the House and Senate will meet this week to come up with final tax bill.” NBC’s Hallie Jackson: “The President and the Republicans in Congress are hoping for a big win with this $1.5 trillion tax cut bill. ... But when you look at what’s actually the sticking points here, there’s a few of them. One surrounds capping deductions for state and local taxes. That is something that affects people in high tax states the most, places like California and New York. So Republicans, especially in the House, who represent those areas have some real concerns. Lawmakers are also deciding on just how big that corporate tax rate cut should be, 20% or 22%.”
Bureau Of Labor Statistics: US Added 228,000 Jobs In November.
Small Business Marketing
The AP (12/8) reported that the Labor Department announced Friday that “US employers added a substantial 228,000 jobs in November, a sign of the job market’s enduring strength in the economy’s ninth year of expansion, and the unemployment rate held at a 17-year low of 4.1 percent.” The Friday jobs report “made clear that the US economy is on firm footing and is likely benefiting from more resilient global growth, with all major economies across the world expanding in tandem for the first time in a decade.” The AP also noted that US economic growth “exceeded an annual rate of 3 percent” over the past six months, the first time in three years that has happened. Indeed Chief Economist Jed Kolko is quoted saying, “It’s a surprisingly strong report given the age of the recovery. After 86 months, we’re still seeing strong payroll gains.”
Labor Department: US Job Openings Fell In October, But Still Reflect Strong Job Market.
Bloomberg News (12/11, Chandra) reports the Labor Department announced Monday that “US job openings unexpectedly cooled in October from an all-time high a month earlier, still consistent with a solid job market.” Bloomberg adds that the data “are in sync with a Labor Department report last week that showed payrolls increased in November following a solid gain in October as the job market moved past hurricane-related distortions to make further progress.” The AP (12/11, Boak) reports, “US employers posted slightly fewer job openings in October than the previous month, but the number of people being hired improved.” In total, “nearly 6 million jobs were available at the end of October, down from 6.18 million in September.” However, “total hires rose 4.4 percent to 5.55 million,” which, “indicates that even if employers are seeking fewer workers that they’re still looking to add staff.” MarketWatch (12/11, Bartash) reports, “Job openings in the US are near a record high and hiring is strong across most industries.” It adds that the “biggest problem” many firms face is “finding skilled workers in a shrinking labor pool.”
NY Federal Reserve Survey Shows Inflation Expectations “Mostly Flat” In November.
Reuters (12/11, Spicer) reports that a survey by the Federal Reserve Bank of New York found “US inflation expectations were mostly flat in November, remaining near their lowest levels in years,” and, “also painted a more positive picture of the job market.” The New York Fed’s Survey of Consumer Expectations, “showed the one-year-ahead measure stable at 2.61 percent.” Reuters adds that despite stability on inflation, “nonetheless, the central bank expects to hike rates again this week in part due to labor market strength,” adding that “the survey reflected this trend with jumps in both earnings growth and employment expectations in November.”
Commerce Department: US Core Capital Goods Shipments Revised Up, October Orders Beat Expectations.
Reuters (12/4, Mutikani) reports, “New orders for US-made goods fell less than expected in October and shipments of core capital goods were much stronger than previously reported, pointing to sustained strength in manufacturing that should buoy the economy.” The Commerce Department reported Monday that “factory goods orders dipped 0.1 percent amid a drop in demand for both civilian and defense aircraft after an upwardly revised 1.7 percent jump in September.” In addition, “shipments of core capital goods, which are used to calculate business equipment spending in the gross domestic product report, advanced 1.1 percent in October instead of the previously reported 0.4 percent rise.”
Fed Expected To Raise Rates Next Week, With Three Further Rate Hikes Likely Ahead.
Reuters (12/4, Sarker) reports that most economists say the Federal Reserve “is almost certain to raise interest rates later this month,” adding that a majority of economists polled “now expect three more rate rises next year compared with two when surveyed just weeks ago.” The data come from a survey “taken just before the US Senate voted to pass tax cuts that are expected to add about $1.4 trillion to the national debt over the next decade,” and the results demonstrate that “economists were already becoming more convinced that rates will need to go even higher.” The passage of Senate tax reform legislation and the increased likelihood of final passage of tax reform “means the forecast risks have shifted toward higher rates, and faster,” Reuters adds. Deutsche Bank Senior US Economist Brett Ryan is quoted saying, “This is about just getting back to a neutral level where monetary policy is neither encouraging growth or pushing against growth.”
Young Readers Spend More Time With Newspapers In Print Than Online, Study Finds. (12/12/2017)
Journalism (UK) (12/7, Scott) reports a study published Thursday in Journalism Studies (12/7) found “that in 2016, 65 per cent of the time spent with newspapers brands by their 18-34 year old readers came via their print editions...compared to 11.9 billion minutes spent accessing the websites and apps of the same publications.” One exception “was the Daily Mail, where young UK readers spent twice as much time with the publisher online than in print, which” the study “attributed to its editorial approach focused on entertainment and celebrities.” Yet, “the time spent reading newspapers has dropped considerably (40 per cent) since the turn of the millennium, and the time spent by 18-34 year olds with newspapers brands has dropped by 64 per cent.”
Snapchat Introduces Promoted Stories For Advertisers.
Wages and Benefits
Re/code (11/24) reported that Snapchat will be rolling out Promoted Stories, a new ad format “which will let advertisers pay to push their story to more users.” The ads will appear on the app’s Stories page. Stories are “one of Snap’s most popular products, and the same product that Instagram successfully copied a little over a year ago.”
Upcoming Small Business Saturday Gets Wide Coverage.
Numerous outlets over the weekend provided coverage of Small Business Saturday. On its website, NBC News (11/17, Ramberg) reported Small Business Saturday is “right around the corner” on November 25, and “there has been a growing swell of support for shopping at local independent businesses on this day wedged between Black Friday and Cyber Monday.” American Express, a founding partner of Small Business Saturday, said in 2016, over 100 million Americans participated in Small Business Saturday. Over 6,700 communities have “pledged celebrate the day with events and media.” NBC News expects Small Business Saturday “to be even bigger this year” due to “marketing support from neighborhood champions, the press, and corporate partners.” NBC News also spoke with six small business experts, who offer advice to small business owners on how to “make the most of the day.”
Attorney Warns Brands To Be Proactive About FTC Rules On Influencers.
Jeff Brown, a partner attorney at the Chicago firm of Michael Best & Friedrich, posted at Ad Age (11/10) that the Federal Trade Commission (FTC) is poised to pounce on “both advertisers and influencers if ‘material connections’ between an influencer and any promoted product or service are not clearly and conspicuously disclosed” in posts. Brown said the FTC has sent out a series of inquiries to influencers, and said brands best take note. He advised brands to make clear influencers’ responsibilities to disclose material connections, monitor what they say, and “follow up to address questionable or improper practices.”
Businesses, Consumers Encouraged To Take Part In Small Business Saturday.
Writing in the Huffington Post (11/1), contributor Melinda Emerson highlighted things small business owners can do to improve their sales during the holiday season. Chief among these is participating in Small Business Saturday, which this year will be held on November 25. “Since 2010, small businesses all over the US have been offering discounts, bundle deals and giveaways to shoppers the Saturday after Thanksgiving. With this being the 7th year, there’s already a significant amount of marketing around this event, so participating in it is just one more way to engage customers and drive sales.” Small businesses should publicize their “Shop Small” strategy well beforehand, and partner with other small businesses.
LinkedIn Adds “Smart Reply” For Conversations, Autoplay Video Ads.
TechCrunch (10/24, Lunden) reports LinkedIn is adding “a new smart reply feature in its messaging app, which gives users prompts with different phrases to use while they are chatting to keep the conversation flowing” on desktops or mobile devices. English will launch first, with other languages to follow, TechCrunch says.
Small Business Owners Search For Alternatives As Health Care Costs Rise. (12/12/2017)
The AP (12/6, Rosenberg) reported that small business owners are receiving notices about premium and coverage changes for next year, and many of them “are facing rate increases of double-digit percentages or dramatically reduced coverage – or both.” The article reported consultants anticipate more owners will “rethink their strategies beyond 2018 and choose alternatives like paying for claims themselves or adding health services that can lower costs.” Some owners said they may no longer be able to protect their employees from rising health care costs. The piece added that the ACA does not require companies with less than 50 employees to provide coverage, “but many do because they feel it’s right or because it helps them compete for and retain top workers.”
Republicans To Target Welfare, Medicare, And Social Security Reform Following Passage Of Tax Bill.
The Washington Post (12/2, Stein) reported President Trump, House Speaker Ryan, and other “high-ranking Republicans” have recently been “hinting that, after their tax overhaul, the party intends to look at cutting spending on welfare, entitlement programs such as Social Security and Medicare, and other parts of the social safety net.” The Post stated that “the remarks...have fueled a growing fear among liberals that the GOP will use higher deficits – in part caused by their tax bill – as a pretext to accomplish the long-held conservative policy objective of cutting government health-care and social-service spending, which the left believes would hit the poor the hardest.” However, the Post acknowledged that Republicans may find “it may be particularly difficult...to push those measures ahead of the 2018 midterm elections, in which many in swing states and districts face well-funded Democratic challengers hoping to ride an anti-Trump wave into office.”
Healthcare.gov Enrollment Up From Last Year By 900,000.
CBS (11/22) reported, “Months after the Republican effort to repeal” the Affordable Care Act failed, the government on Wednesday said 2.3 million Americans have enrolled in individual health plans using Healthcare.gov, which is “900,000 more than at this time last year.” The Washington Post (11/22, Goldstein) reported that the higher enrollment during the current sign-up period of Nov. 1 to Dec. 15 could reflect “public understanding that this sign-up season lasts six weeks, half as long as in the past few years, so people are hurrying to act early before the Dec. 15 deadline.”
Centrist Policy Institute Calls For Tiered National Minimum Wage.
In an op-ed in the New York (NY) Times (11/17, Subscription Publication), centrist policy institute Third Way president Jonathan Cowan senior vice president Jim Kessler wrote that the national minimum wage should “be a range of national minimum wages that recognizes the differences in living cost and labor markets in a way that is both flexible and permanent.” The “average national minimum wage – that is, the minimum wage in regions of the country that experience a cost of living close to the national average – should be pegged to an objective measure that recognizes labor market realities and lifts the maximum number of people out of poverty,” Cowan and Jim Kessler explained.
Media Analyses: Officials Send Mixed Signals On Keeping ACA Mandate Repeal In Tax Bill.
OMB Director Mulvaney told CNN’s State of the Union Sunday that if repealing the ACA’s individual mandate becomes an “impediment” to passing tax reform legislation, the White House is open to removing that provision from the legislation, the Washington Post (11/19, Sullivan) reported. Mulvaney said, “If we can repeal part of Obamacare as part of a tax bill and have a tax bill that is still a good tax bill, that can pass, that’s great. ... If it becomes an impediment to getting the best tax bill we can, then we are okay with taking it out.” However, he added that “he does not think it is currently an impediment,” and House and Senate negotiators would have to determine whether to include the provision in the final bill.
Maryland County Officials Increase Minimum Wage To $15 A Hour.
The AP (11/7) reported the Montgomery County Council voted unanimously to raise its minimum wage to $15 an hour over a period of years. The bill would require large employers to adopt a $15 hourly wage by 2022 and small employers would need to adopt the higher wage by 2024.