Changes in legislation often present new experiences for small businesses, whether that means new opportunities — or challenges. One such piece of legislation is the Affordable Care Act. About 28 percent of ACA signups in 2014 were small business owners or self-employed entrepreneurs reliant on the legislation for health care.
But according to Arturo Osorio-Fernandez, an expert on small business and assistant professor at Rutgers Business School, changes to the ACA could make health care inaccessible to some entrepreneurs and their families.
“Some entrepreneurs might choose their career path because they want more time at home with their younger children. Lack of insurance may be a deterrent to [entrepreneurship],” Osorio-Fernandez said. “Innovation and the creation of new business might not be able to be entertained because it’s either that or a doctor’s visit.”
Some are skeptical, too, about changes in the tax system: Will it benefit the economy as hoped, or will drawbacks outweigh benefits?
“The change in the tax structure for business will remain to be seen if in fact it stimulates the economy, hiring within and spurring opportunities for their growth,” said Lorraine Allen, Regional Director for New Jersey Small Business Development Center at The College of New Jersey, adding the change in individual tax reductions also could have an impact.
Osorio-Fernandez suggests that given the new changes, business owners who traditionally do taxes on their own might want to look into hiring an accountant. “That can be expensive, [but] the new changes have to be fully understood,” he said.
Another possible game changer is the $15 minimum wage, which Michele Siekerka, president and CEO of the New Jersey Business & Industry Association, described as a “headwind” small businesses will face in 2018.
In cities around the state, small businesses in urban centers should expect a boost due to an uptick in millennial residents, according to Barbara E. Kauffman, executive vice president and COO of Newark Regional Business Partnership. “The interest of millennials in moving back to the city has generated increased interest in business of all types to also locate in urban centers,” she said.
In Newark specifically, multiple initiatives are strengthening the local economy. For example, Hire. Buy. Live. Newark is a partnership between the city of Newark, its business community, higher education and medical institutions, clergy, philanthropies and workforce development programs to strengthen the city’s economy and reduce its unemployment and poverty over the next decade. Newark 2020 is billed as “a 20/20 vision for connecting 2,020 unemployed Newark residents to work by 2020.”
“These initiatives, and the mayor’s commitment to looking at all the neighborhoods rather than just the downtown area, means development has spread throughout our city,” Kauffman said. “There’s always questions about the direction of the economy and what national policies will mean. No one understands the implications fully for some of the changes that are coming down.
“Statewide and on a national scale, there are things that could influence the business climate. With the new administration it’s looking like there will be an increase in investment which is good, but we will have to see. I think the changes from Trenton will be good ones.”
As businesses crop up in any community, urban or otherwise, Osorio-Fernandez suggested the following: Businesses aren’t about selling products — they are about being gateways to access products and services. If a community is lacking a product, he said, local businesses that know how to create it will thrive. He used as an example: “Fresh bread with the quality of the home country delivered to your door is an appealing product for restaurants.”
“In 2018, [North American Free Trade Agreement] negotiations can harm access to products,” Osorio-Fernandez said. “Local businesses that provide ethnic products that are no longer available because of trade limits can do very well.” he said.
One final thing to keep in mind? The consumer, the business partner and the competition are all human.
“There is absolutely no substitute for seizing the opportunity to remember we are still buying from [and] selling to human beings,” TCNJ’s Allen said. “Staying human-centric — the more focused on details of wooing, supporting and rearing our networks, the more loyalty businesses will retain. It is easy to distract and attract customers away from us unless we stay focused on the people first.”