Last week Xero hosted customers and journalists for a lively dinner in New York to share insights about the small business climate as it relates to next year’s presidential election. Guests included Jacob Wood, founder of Woodies Clothing, accounting partner Ean Murphy of Moxie Bookkeeping, Gene Marks, a small business expert and columnist, and several New York-based journalists.
Business and politics
We discussed a range of concerns impacting small business, from taxes to ACA to regulatory issues. Wood, whose company produces custom-made shirts billed to fit perfectly, took a relatively neutral stance. He said his business was mostly insulated from electoral politics. While some voiced concerns over potential audits due to freelancing practices, Murphy said she offers all her workers the choice of either freelancing or becoming a full-time employee.
Wood and Murphy in many ways exemplified some of the tectonic shifts currently taking place in the American business landscape. For instance, the success of Woodies Clothing can at least in part be attributed to the rise of online shopping. Most guests agreed that in recent years, traditional retailers have increasingly fallen out of favor among consumers, with big box stores and shopping malls largely failing to innovate at the same pace as smaller, more agile and technology-driven brands.
The gig economy
Murphy fell somewhat on the opposite end of the spectrum. She questioned whether some of these new trends were in fact generating positive outcomes for workers, business owners or the economy. She argued that while startups like Uber and Postmates were indeed very convenient, they also relied entirely on freelance labor. Uber’s workforce has reached over 160,000 drivers. This has had the effect of rapidly engendering an entire class of laborers who lack basic benefits like health insurance and paid sick leave.
The participants expressed doubt that presidential candidates would spend much time addressing the pressing issues that are impacting small businesses. But there are at least indications that some on the campaign trail are starting to recognize the broader economic and political ramifications of the “gig economy.” Hillary Clinton has expressed views similar to Murphy’s. She’s argued that while on-demand services are helping to unleash innovation, they also raise important questions about what a good job will look like in the future.
Xero believes small businesses, and the issues that affect them, should be integral to any presidential hopeful’s campaign. After all, small business contributes over 50 percent to the country’s GDP.
If we’re to continue to rely on small business as an economic driving force in the US, it is critical that policies are instituted to help entrepreneurs thrive in today’s environment. And the first step in achieving that is robust conversation and critical debate.
This story on Inc. references a couple of conversations we had that night as well.
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