Here’s What Happened in the World of Small Business in May 2021
If you’ve been focused on your business reopening (or if you're on that first vacation in over a year!) you might have missed these five things happening in the world of small business.
With more and more people being vaccinated, rules being relaxed or changed, and the new presidential administration working on tax changes, a lot has happened this past month.
Here are five things that happened in May 2021 that may affect your business:
1. As offices reopen, some employees don’t want to go back – ever.
As businesses across the country continue to reopen, the conversation around working from home or returning to the office (or some combination) is growing louder. According to a Harris Poll survey, if they had a choice, 40% of Americans would prefer to work from home full-time, 35% would like a home-office hybrid, and 25% would want to go back to the office full-time. This provides a 2021 perspective on conclusions of the Future of Work report from 2020, which found that about 60% of employees around the world will be spending at least 40% of their time working remotely.
Why this is important for your business:
To make decisions about your work-from-home policies, consider how they may influence employee satisfaction (and probably retention).
2. Inflation fears abound as prices across various sectors continue to rise.
From the New York Times: “As the economy gains steam, demand is coming back faster than supply. It’s a recipe for bigger price tags for everything from airline tickets to used cars, at least temporarily.” The question is whether inflation is temporary, a result of a spike in demand due to businesses reopening and consumers feeling more free to spend on services and goods, or whether it is more permanent (and thus more worrisome). Congress has put the Federal Reserve in charge of controlling inflation, and while the Fed thinks the jump in prices this year will fade, fears across the political spectrum continue.
Why this is important for your business:
Inflation would affect just about everything with your business. And if inflation jumps too high too quickly, there is a chance the Fed would raise interest rates, which would affect any borrowing your business may have to do in order to grow.
3. As companies race to attract service workers, some are increasing their minimum wage.
As shops and restaurants reopen, some – like Chipotle – are increasing pay to entice candidates to work there. Meanwhile, McDonalds workers in 15 cities (including Tampa, Orlando, and Miami) executed strikes this month to demand a company-wide minimum wage of $15.
Why this is important for your business:
The push for a national $15 minimum wage seems to have stalled for now, but some businesses are feeling the need to increase their wages to catch the eye of new employees. Businesses in Florida are preparing for the minimum wage to increase to $10 this September, part of a longer-term plan that will ultimately raise it to $15 per hour by 2026.
4. The Biden Administration has proposed a minimum tax rate of 15% for multinational companies.
The Treasury Department has argued that multinational corporations should pay at least a 15% tax on their earnings. President Biden has also proposed raising the corporate tax rate in the U.S. from 21% to 28%, which would be higher than the corporate rate in most other countries. Raising the global minimum tax to 15%, the Administration argues, would prevent American companies from being at a disadvantage or from moving their operations out of the country. In a statement, the Treasury Department “underscored that 15% is a floor and that discussions should continue to be ambitious and push that rate higher.”
Why this is important for your business:
If your business is a multinational corporation or aspires to be, this would affect your bottom line.
5. As Americans start dining out again, food supply chain issues loom.
As COVID restrictions have eased, businesses are scrambling to get the staff and supplies they need to fully operate. People are heading back to restaurants, bars, and other types of dining establishments, but the Wall Street Journal reports that “suppliers and logistics providers say distributors are facing shortages of everyday products like chicken parts.” They’re also facing “difficulty in finding workers and surging transportation costs as companies effectively try to reverse the big changes in food services that came as coronavirus lockdowns spread across the U.S. last year.”
Why this is important for your business:
If your business is in the food and beverage industry, these supply chain interruptions could create problems for your operations.
