In the lead-up to the election on November 5th, small business owners across America, who historically enjoy the highest levels of public trust among institutions, express a concerning degree of uncertainty regarding the future. Despite a significant divide between political parties, both Republicans and Democrats actively court this influential demographic. The legitimacy of small businesses is underscored by their critical role in the U.S. economy, accounting for nearly half of all private sector employment and generating over 60% of new job growth since 1995. According to a Gallup survey, small businesses enjoy a substantial trust rating, with 68% of Americans expressing confidence in the sector compared to 16% for large corporations and even less for Congress.
The National Federation of Independent Business (NFIB) reports a notable spike in uncertainty among small business owners. Its measure of uncertainty reached historical highs in September, surpassing levels seen during the tumultuous times of the 2020 elections amid the pandemic. Furthermore, small business optimism is low, as reflected in the NFIB’s Optimism Index, which has remained below the average for an extended period. This backdrop of anxiety creates a politically charged environment where both major parties attempt to address the specific concerns of small business owners as part of their electoral strategies. Republican strategies generally revolve around tax cuts and deregulation, while Democrats, with Vice President Harris at the forefront, focus on helping new entrepreneurs launch their ventures.
The political landscape reflects a shift in sentiment among small business owners. While many previously favored former President Donald Trump, a recent survey indicates a decline in his approval among small business proprietors, coinciding with rising discontent regarding President Joe Biden. However, Harris’s efforts are noteworthy, targeting the small business community that traditionally leans Republican. For example, she has proposed significant tax deductions to assist small businesses, trying to resonate with owners who face mounting operational costs and tight profit margins.
Real-life experiences of small business owners like Jim Croley from Wooden Keg Tavern illustrate the challenges they face. While he appreciates new initiatives aimed at fostering business creation, he stresses the importance of supporting existing businesses with established customer bases. This reflects a broader sentiment within the industry: while there is recognition of the need for new entrepreneurial endeavors, an equal urgency exists to sustain those small enterprises already grappling with soaring operational costs. These perspectives on governmental support influence where business owners find political alignment, revealing that their preferences are shaped by their current stages of operation and the specific challenges they encounter.
Data indicating a surge in new business registration during the Biden administration raises further questions about support for the small business ecosystem. This has been particularly noted in historically underserved communities, with substantial research pointing to a rising entrepreneurial spirit fueled partly by the pandemic. Meanwhile, legislative considerations surrounding the future of the Qualified Business Income (QBI) deduction, a vital tax advantage for many small businesses, loom large. Stakeholders are eager to see its future, especially given that existing provisions set to expire could significantly impact operational viability and growth potential for a large number of small businesses.
As candidates continue to address the needs of small businesses, distinguishing issues shape their respective platforms. Trump’s campaign is characterized by an emphasis on making tax cuts permanent, while Harris introduces plans aiming to simplify taxation for small businesses along with incentives for new ventures. In a landscape where political alignment does not strictly correspond to party affiliation among small businesses, the outcome of their concerns could largely influence their voting behavior, suggesting that broader economic policies and practical support mechanisms will play pivotal roles in shaping the future landscape for small businesses in America—regardless of who ultimately wins the election.