By Manta, Special for USDR
The fast-approaching presidential election is not the only government issue on the minds of small business owners this summer. Between changes in the Affordable Care Act (ACA), local minimum wage increases and employee overtime rules, small business owners are facing a triple whammy of regulatory changes, making the task of compliance more challenging. To gauge the small business landscape, Manta’s Semi-Annual Wellness Index asked small business owners to evaluate their businesses and share what regulatory issues are the most difficult to understand and comply with.
Government regulations and red tape can be a tremendous barrier to small business growth, and many owners (41%) believe their business has been negatively impacted by recent national and local regulatory changes. More than half of owners (51%) feel they do not receive enough warning ahead of regulatory changes. Perhaps that’s why 40 percent of owners say they spend between one and five hours a week dealing with regulatory issues. Another 10 percent spend between six and 10 hours, and 11 percent spend more than 10 hours a week.
“2016 has already brought major changes at the federal and state levels, and more changes are on the horizon,” said Manta CEO John Swanciger. “Entrepreneurs are trying to figure out how to remain profitable amidst the growing costs of compliance. Those who can be resourceful and stay nimble in the process will better position themselves for success.”
Regulatory Challenges Hitting Owners on a National and Local Level
Nationally, tax regulations were cited by one in three (33%) small business owners as the most confusing rules to understand. This was closely followed by the Affordable Care Act (21%), new SEC crowdsourcing rules (15%) and Occupational Safety and Health Administration (OSHA) regulations (7%).
On a state level, entrepreneurs listed taxes (36%), licensing (30%) and labor rules (16%) as the most difficult to comply with. When looking across states, New York and California small business owners were the most likely to cite regulations in their respective states as being difficult or very difficult to comply with (52% and 50%). This contrasts sharply with states like Texas, where only 29 percent said it was difficult or very difficult to comply with state regulations.
To better understand regulatory changes, many small business owners (27%) turn to professional advisors, online small business communities (22%) and the news (19%). Only about 11 percent turn to their local government for help.
Candidates View on these Issues Could Affect Small Business Votes
Interestingly, state and national regulations are not only affecting the way small business owners are running their companies, but also who they’re voting for in the upcoming presidential election. A recent Manta poll found 37 percent of small business owners believe Donald Trump is the best candidate for small business. Although Hillary Clinton trails with 28 percent of the vote, 36 percent remain undecided, indicating that a sizeable number of small business votes are still up for grabs.
“As a small business owner, and the son of a small business owner, I’ve learned first-hand how state and federal regulation has stymied opportunities for entrepreneurs,” said Nick Braun, CEO and founder of PetInsuranceQuotes.com, a comparison website for pet insurance. “Unnecessary taxes, lending restrictions and reporting requirements favor big business and create headwinds for small business owners who are trying to grow and prosper. I don’t agree with everything Donald Trump says regarding social issues, but when it comes to business sensibility, he’s a breath of fresh air in today’s age of career politicians.”
Tips for Dealing with 2016’s Triple Whammy of Regulations
1. Figure out where you can go to for support. More than a third (38%) of entrepreneurs rated the level of support their business receives from the local governments as “poor.” Given this low rating, it’s important for entrepreneurs to know what other community resources are available them. The Small Business Administration (SBA) has local offices throughout the country that provide counseling and training programs around compliance. Local chamber of commerce offices also offer resources to help with federal and local compliance.
2. Join community organizations and industry associations. Getting involved in online or local business and industry organizations can help you stay abreast of changes specific to your area or industry. Many of these groups provide affordable resources for dealing with compliance. One such online resource is Manta Academy, which offers free educational courses to help small business owners grow and manage their businesses.
3. Implement training programs around compliance. Manta’s poll showed that 36 percent of small business owners are planning on hiring new employees during the second half of 2016, up from 28 percent in the first half of the year. To make sure all employees comply with new regulatory changes, owners should implement training programs on the new rules and any procedural changes their business has made.
Manta empowers small business owners to succeed on their own terms by helping them stand out, connect with customers and grow their companies. Our solutions include a small business directory with millions of unique monthly visitors, valuable content and a suite of products to manage critical business needs. We strive to inform and inspire through learning opportunities, proprietary research, and a robust online community for dialogue and collaboration. Thousands of business owners join Manta each month. Visit manta.com to learn why.