NFIB Weekly News
Leading the News
March Small Business Optimism Index Continues 16-Month Streak Of Historically High Results.
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. Business Climate
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.”
Despite Outcry, Administration To Proceed On Tariffs.
With trade advisor Peter Navarro and Commerce Secretary Ross making the rounds on the Sunday shows, most media reports remarked on their forcefulness in defending the President’s decision to levy tariffs on steel and aluminum imports. Trump also reiterated his position on Twitter on Sunday, writing, “We are on the losing side of almost all trade deals. Our friends and enemies have taken advantage of the US for many years. Our Steel and Aluminum industries are dead. Sorry, it’s time for a change! MAKE AMERICA GREAT AGAIN!” Media analyses also reflected what the AP (3/4, Freking, Miller) termed the blurred “lines of partisanship” on the trade issue, with “labor unions and liberal Democrats...in the unusual position of applauding Trump...while Republicans and an array of business groups are warning of dire economic and political consequences if he goes ahead with the tariffs.”
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.”
Canadian FM Suggests No Breakthrough In Latest NAFTA Talks. Small Business Marketing
Reuters (4/6, Lawder) reported that after meeting with USTR Lighthizer and Mexican Economy Minister Ildefonso Guajardo on Friday, Canadian Foreign Minister Chrystia Freeland told reporters that the US, Canada, and Mexico remain deadlocked on several major issues in NAFTA renegotiations, “casting doubt that the quick deal sought by Washington would materialize.” Reuters explained that Lighthizer, citing the need to reach a consensus ahead of Mexico’s presidential election on July 1, “says he wants the outlines of a deal soon to update the regional trade agreement.” There are several “major challenges to overcome” in reaching that goal, however, “in particular a contentious U.S. demand that the North American content of vehicles made in NAFTA countries be increased to 85 percent from 62.5 percent.”
Semprevivo: Trump Administration Regulatory Reform Boosts Small Businesses.
In a column for Investor’s Business Daily (4/3, Semprevivo) Joseph’s Lite Cookies President and CEO Joseph Semprevivo addressed regulatory reforms undertaken by the Trump Administration, writing that it has enacted a “long line of pro-growth regulatory rollbacks.” The administration “has slashed well over 1,500 planned regulatory actions,” and, “has repealed 22 regulations for each new rule issued, cutting regulatory costs by more than $8 billion.” As a result, Semprevivo stated, “small business owners are counting their blessings,” because as “America’s most dedicated job creators – who account for two-thirds of all new U.S. jobs – [they] have been drowning in red tape.”
Pence Promotes Tax Reforms.
The Atlanta Journal-Constitution (3/23, Bluestein) reported that Vice President Pence visited Atlanta, Georgia last Friday for a pair of events promoting the recently passed tax cuts and fundraising for the Georgia GOP. Pence spoke to a “crowd of hundreds” at an America First Policies event, where he was “joined by Gov. Nathan Deal and U.S. Reps. Karen Handel, Barry Loudermilk and Rob Woodall to highlight the package of $1.5 trillion tax cuts.” Pence said that the Administration has “been working hard to keep the promises to the people of Georgia,” and touted a “record of promises made – and promises kept.”
Some Conservatives Slam Trump For Signing $1.3 Trillion Spending Bill.
The Hill (3/24, Anapol) reported Fox News hosts were among the “biggest critics” of President Trump’s decision to sign the $1.3 trillion omnibus spending bill on Friday, despite an earlier threat to veto. The Hill highlighted comments from Laura Ingraham and Sean Hannity, both calling on Trump to veto the bill and force lawmakers to return to Washington, and noted that “other conservative voices, including Ann Coulter and Matt Drudge” were also critical of the President. Similarly, Mike Allen wrote at Axios (3/24, Allen) that a “former White House official” said the conservative backlash to the bill “is the hardest I’ve ever seen the base turn on Trump over anything.”
Mnuchin Says Economy “Well On Its Way” To Three Percent GDP Growth.
On Fox News Sunday (3/25, Wallace), Treasury Secretary Mnuchin discussed Federal Reserve projections for GDP growth of 2.7 percent in 2018 and 2.4 percent in 2019. Mnuchin said, “As I repeatedly said, our objective is three percent or higher. The President would like us to get higher than that, but at three percent there’s trillions of dollars of additional revenue to the government and tens of trillions of economic growth.” Mnuchin added, “We are well on our way to the three percent growth and tax reform and tax cuts are a big part of that.”
JPMorgan Chase Announces $2.5 Million Expansion Of Ascend 2020 Program Backing Minority-Owned Small Businesses.
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.”
Few Advertisers Leave Facebook. Wages and Benefits
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.”
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.”
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.”
Google Adds YouTube Targeting For Users Who Searched For Products, Services.
Search Marketing Daily (3/14, Sullivan) reported Google announced new options in AdWords that will allow advertisers to target YouTube users “who recently searched for products and services” on Google, while other new features offer customized calls to action with video ads and the ability to keep campaign notes and get recommendations, “including suggestions to set the optimal bidding strategy, add audiences, or create better ads.”
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.”
Administration Rolls Out New, Patient-Focused Approach To Healthcare.
The AP (3/10, Alonso-Zaldivar) reported “the Trump administration is taking a pragmatic new tack on health care,” focusing on “consumer friendly changes and savings.” Health and Human Services Secretary Azar is rolling out the agenda, which the AP stated is focuses on improving electronic medical records, lowering prescription drug costs, implementing value-focused payment systems in Medicare, and “getting true prices for health care goods and services in front of consumers” to encourage better market competition.