NFIB Weekly News
NFIB Weekly News
Leading the News
US Could Seek Farming, Car Manufacturing Concessions In TPP Talks. (04/17/2018)
The Wall Street Journal (4/15, Davis, Subscription Publication) reported that if the US were to follow up on the President’s reported desire to re-enter the deal, both sides would seek concessions. In contrast to the pre-2016 period, the US would now negotiate with the TPP-11 bloc, where countries such as Japan, Malaysia and Vietnam are expected to view a US re-entry favorably. In negotiations, the US could push for Japan to improve access to US farm products, particularly a reduction in rice tariffs. To the Journal, Japan may view that as a reasonable price to pay to get the US back in the agreement.
March Small Business Optimism Index Continues 16-Month Streak Of Historically High Results. Business Climate
NFIB’s SBET for March showed a small business optimism index of 104.7, down from February’s 107.6 from February but still within the top five percent of 45 years of survey results. NFIB indicated that March’s index continues a 16-month streak of results in the top five percent. NFIB President and CEO Juanita Duggan was quoted saying, “It has been a remarkable 16 months for small business optimism. ... This is the first time in 35 years where the fewest number of small business owners have told us that taxes are their number one business problem.” Chief Economist Bill Dunkelberg was quoted adding, “Hiring and spending on new buildings and land acquisition remained at strong levels, a good sign of confidence in economic prospects.”
Mnuchin: Tariffs Won’t Hurt US Economy, US And China Negotiating.
The Los Angeles Times (3/25, King) reported Treasury Secretary Mnuchin said on “Fox News Sunday,” “I don’t expect to see a big impact on the economy” from President Trump’s recent tariff announcements, “brushing aside last week’s market swoon fueled by investors’ fears of a trade war.” However, Trump’s imposition of “stiff tariffs” on steel and aluminum imports has “rattled” investors. The Wall Street Journal (3/25, Tracy, Subscription Publication) reported Mnuchin cast both countries’ trade actions as part of ongoing negotiations.
China Imposes Retaliatory Tariffs Against Nearly 130 US Products.
Reuters (4/1) reported China’s Finance Ministry said new tariffs, to take effect Monday, will affect 128 American products, “including frozen pork, as well as on wine and certain fruits and nuts, in response to US duties on imports of aluminum and steel.” The AP (4/1) similarly said the tariffs are in “retaliation against taxes approved by President Donald Trump on imported steel and aluminum,” and Sunday’s “announcement follows through on warnings Chinese officials have made for several weeks in an escalating trade dispute with the United States.”
White House: US Negotiating With Several Countries Over Tariffs.
Reuters (3/16, Rascoe) reported White House press secretary Sarah Sanders on Friday said President Trump is engaged in talks “with a number of individual countries” on providing exemptions to new steel and aluminum tariff “and negotiating on areas of national security where we can work together and there’s some flexibility there.” She added, “We’re continuing to have those conversations and will continue through...the end of next week.”
Meanwhile, Reuters (3/16, Escritt) cited the German magazine Der Spiegel in reporting USTR Lighthizer has “set conditions for scrapping its planned punitive tariffs on steel and aluminum imports from Europe.” Reuters says these include “capping U.S.-bound exports of the metals at 2017 levels” as well as “a promise that Brussels take measures against steel dumping from China and cooperate in a wide range of other trade issues.” Reuters said that the magazine added Lighthizer “also set out conditions in the field of defence policy – Europe had to provide ‘proof’ that it would step up its armaments efforts.”
Business Optimism Continues At Record Highs.
NFIB’s Small Business Economic Trends Survey for February shows that business optimism rose to 107.6, continuing its streak of record highs that include a jump in the number of small business owners increasing compensation and capital outlays. NFIB President and CEO Juanita Duggan is quoted saying, “When small business owners have confidence and certainty in the economy, they’re able to hire more workers and invest in their businesses. ... The historically high readings indicate that policy changes – lower taxes and fewer regulations – are transformative for small businesses. After years of standing on the sidelines and not benefiting from the so-called recovery, Main Street is on fire again.” Chief Economist Bill Dunkelberg is quoted saying, “The fact that several components saw significant increases tells us that small businesses are flourishing in a way we haven’t seen in over a decade.”
Janetsky: Only A Small Fraction Of Federal Contracts Go To Women-Owned Small Businesses. (04/17/2018)
Megan Janetsky wrote in a piece for OpenSecrets (4/13) that the federal government awarded $25.4 billion in contracts to women-owned small businesses in 2017, which “marked a record high for those businesses.” But that figure “only made up 5 percent of the $508.4 billion in federal contracts awarded that year, a Center for Responsive Politics analysis of contract data on USAspending.gov shows.” Women own more than a third of all businesses, but “according to a 2015 Small Business Administration report, those businesses are 21 percent less likely to win contracts compared to otherwise similar firms not owned by women.” Furthermore, “of the top 50 most expensive contracts awarded by the federal government in 2016 and 2017, not a single one was awarded to a women- or minority-led business, data shows.”
Waldie: Make Tax Cuts Permanent To Help Small Business. Small Business Marketing
In a column for The Cleveland Plain Dealer (4/13), Crum Manufacturing Owner and CEO Douglas Waldie wrote that “President Donald Trump worked with Congress in 2017 to pass the historic Tax Cuts and Jobs Act, which lowers individual tax rates at every level, cuts the corporate tax rate by 9 percent, raises the estate tax exemption, and offers pass-through business owners a 20 percent deduction on their business income.” He added that “these changes will allow me to pay my workers more, grow my business, and invest in Waterville,” while, “lower tax rates on individuals, pass-through businesses and corporations translate to more investment and a vigorous economy.” He concluded, “Congress passed historic tax reform last year, but the job isn’t finished. We are once again looking to our elected representatives in Washington to make these pro-growth tax cuts permanent.”
Economists Foresee “Solid Economic Expansion” This Year.
Bloomberg News (4/15, Kennedy, Miller) reported an article outlining projections from prominent economists for global economic growth this year. Overall, “economists on Wall Street and beyond are sticking to forecasts for another solid economic expansion in 2018.” Morgan Stanley Economist Jari Stehn said that “the end does not seem near” for the current cycle of growth, while HSCB Holdings Special Economic Adviser Willem Buiter was quoted saying that “he global synchronized recovery looks set to continue in 2018,” and adding, “[G]lobal growth is very robust by post-crisis standards, all regions of the world are participating in a synchronized upturn and unemployment is falling more or less everywhere.”
President Trump Instructs EPA To Ease Permitting For Businesses.
The Tribune News Service (4/13, Barboza, Halper) reported that “President Donald Trump took aim at federal air quality standards Thursday, directing the Environmental Protection Agency to relax restrictions on state governments and businesses,” adding that “the president instructed EPA Administrator Scott Pruitt to more quickly review states’ smog-reduction plans, make it easier for businesses to get air quality-related permits.”
Pence: NAFTA Deal Possible Within Weeks.
Reuters (4/14, Rampton) reported Vice President Pence “said on Saturday he was leaving a summit of Latin American countries in Peru very hopeful that the United States, Mexico and Canada were close to a deal on a renegotiated NAFTA trade pact.” He “told reporters it was possible that a deal would be reached in the next several weeks,” and “also said that the topic of funding for U.S. President Donald Trump’s proposed wall on the U.S. border with Mexico did not come up in Pence’s meeting with Mexican President Enrique Pena Nieto.”
Administration Seeks To Calm China Trade War Fears.
As part of a series of tweets, USA Today (4/8, Jackson) reported the President “vowed friendship” with Chinese President Xi Jinping “despite their trade differences,” as he and his top aides “sought to tamp down market fears of a trade war” between the two countries. The President tweeted, “President Xi and I will always be friends, no matter what happens with our dispute on trade.” He also predicted, “China will take down its Trade Barriers because it is the right thing to do. Taxes will become Reciprocal & a deal will be made on Intellectual Property. Great future for both countries!” Bloomberg News (4/8, Krasny, Chandra) said Trump “predicted China will be first to buckle” after “a week of rising tensions on trade,” but the AP (4/8, Lemire) said he “did not explain why, amid a week of economic saber-rattling between the two countries that shook global markets, he felt confident a deal could be made.”
Video Examines How Print Ads Have Gone Interactive. (04/17/2018)
Publishing Executive (4/11, McGee) posts a video that explores “interactive print ads,” including “magazine ads that change color at the push of a button, inserts that collect solar power to charge a cell phone,” and “a car ad that actually checks your pulse while making it race.”
JPMorgan Chase Announces $2.5 Million Expansion Of Ascend 2020 Program Backing Minority-Owned Small Businesses. Wages and Benefits
According to Black Enterprise (4/5, McKinnet), JPMorgan Chase announced Thursday the launch of a “$2.5 million expansion of the Ascend 2020 program backing minority-owned small businesses over the next three years, boosting it to 10 U.S. cities from six.” Black Enterprise explained that Ascend 2020 is an “initiative to provide capital to minority-owned small businesses and help them land contracts with anchor institutions like hospitals, school systems, and universities.” The program is currently active in Chicago, Los Angeles, Atlanta, the Bay Area, Seattle, and Washington, D.C., “as part of JPMorgan Chase’s $150 million Small Business Forward program to help women, minority, and veteran entrepreneurs.”
Columnist: Facebook’s Woes Could Benefit Amazon’s Ad Business.
Breaking Views (3/23) columnist Liam Proud wrote that “Facebook’s crisis could turn digital advertising’s duopoly into a triopoly,” with Amazon standing to “benefit.” While some ad dollars may move from Facebook to Twitter or Snap, Proud said Amazon could be the “real winner.” While Amazon only accounts for 3 percent of digital ad spend and “needs to avoid riling antitrust regulators, who are already wary of its dual role as both e-commerce seller and product-search provider,” Proud said “Facebook’s ills nonetheless give Bezos the chance to elbow his way into the digital duopoly.”
As Patients Turn To Social Media For Info About Drugs, So Do Physicians, Pharma.
NPR (3/23, Wilhelm) reported that physicians and pharma companies are “analyzing social networks to get a faster, wider look into how patients react to drugs, sometimes picking up information about side effects that clinical trials missed.” The analysis is driven by patients who have gone to social media for answers, because “they don’t really give you a handbook” about stage 3 colorectal cancer, “so you search kind of anywhere for answers,” said Allison Ruddick. She was diagnosed in 2014 and “turned to the world of hashtags.”
Few Advertisers Leave Facebook.
Ad Age (3/30, Slefo) reported that “only seven” of Facebook’s “top 1,000 ad spenders” have left in the wake of recent controversies, and two of those, “AthenaHealth and Mojoness, said the halt in ad spend was unrelated” to those matters, while “the other five, UsedCars.com, Charity Water, SimpliSafe and Teecai did not respond to requests for comment.”
Twenty Percent Of Retailers Advertise On Amazon, Digiday Finds.
At its Retail Summit event last month, Digiday (3/19, Weiss) “sat down with 53 retail executives to hear how they approach marketing on Amazon.” Digiday found that just “20 percent of retailers in Digiday’s survey advertise on Amazon,” none of which “are spending more than 50 percent of their marketing budget on Amazon.” Additionally, 27 percent revealed “they plan to advertise on Amazon in the coming year.” None of the retailers have “recently purchased an ad on Amazon Spark,” which Digiday says is “unsurprising” given that Spark “has struggled to grow its user base, and many of its influencers question whether it provides any return on investment at all and are unsure if they will continue using it.” Digiday explains that one of the reasons only 20 percent of the retailers “advertise on Amazon is that a significant number of them avoid selling their products directly on the platform.”
Professor: Congress Should Choose Right Work Requirement Policies. (04/17/2018)
In an op-ed in the Wall Street Journal (4/11, Subscription Publication), Economics Professor David Neumark wrote that two more-stringent work requirements for welfare programs that federal agencies are encouraged to adopt thanks to President Trump’s executive order this week can work in opposite directions in terms of their effects on future earnings. Neumark cited research finding that a more generous Earned Income Tax Credit (EITC) leads to significantly higher earnings in the long run among less-educated single mothers – an important population group for reducing poverty. Minimum wage policies, on the other hand, lead to higher poverty and an increased reliance on public assistance in disadvantaged neighborhoods. Neumark encouraged lawmakers in Washington to pursue antipoverty policies that lead to economic self-sufficiency in the long run.
Researchers To Examine Whether Minimum Wage Increase In Minneapolis Improves Workers’ Health.
The Minneapolis Star Tribune (4/5, Olson) reported University of Minnesota researchers are “recruiting 450 low-wage workers in Minneapolis to monitor their health – and hopefully see progress – as their wages increase over the next five years because of the city’s new minimum wage standards.” The article explained that the city’s “minimum wage increase is creating a rare opportunity for researchers to” test whether higher income leads to “better health.”
Companies Using Tax Cuts To Reinvest In Workforce.
Business Insider (3/30, Feloni) reported about 15 companies that are using their savings from the Tax Cuts and Jobs Act. For example, FedEx received “$385.7 million in tax savings” from the tax cut and “is putting all of its savings toward an investment in workers and jobs, including $200 in increased compensation and a contribution to the $1.5 billion seven-year plan for building outs its Indianapolis hub.” The story breaks down the investments as “48% to workers” and “52% to jobs.”
WPost Praises Bipartisan Restaurant Tip Provision Within Omnibus Spending Bill.
In an editorial, the Washington Post (3/30) praised the “one nugget of genuine bipartisan policymaking buried within” the $1.3 trillion omnibus spending bill passed last week – the repeal of a proposed Labor Department regulation that seemed to allow restaurants to keep waiter’s tips, as long as they are paid the full statutory minimum wage. The provision also makes clear that “tips belong to workers and may not be diverted into management’s coffers, although they can go to the back of the house when servers get full minimum wage.”
WSJournal Analysis: Rising Healthcare Premiums Likely A Key Election Issue.
The Wall Street Journal (3/25, Armour, Subscription Publication) reported that just ahead of the 2018 midterm elections, healthcare premiums are likely to increase due to Congress not including any federal money in the new spending package to bolster insurance exchanges. Now, both Democrats and Republicans blame each other for the likely increase in premiums. The Journal added that polls have indicated healthcare is likely to be a key issue in the November elections.
ACA Marketplace Insurers Made Profits Last Year, Thanks To Premium Spikes.
Politico (3/17, Demko) reported many of the insurers still offering plans in Affordable Care Act marketplaces made a profit on those plans for the first time last year, thanks primarily to a dramatic increase in premiums. A Politico analysis of 29 regional Blue Cross Blue Shield plans found that they increased by over 25 percent on average last year, and spent an average of 80 percent of premium revenues on medical costs – down 12 percent from the year prior. Politico added that while the change is a positive for the markets, the Trump Administration’s efforts to cut away at ACA regulations “are likely to further destabilize the markets.”