NFIB Weekly News
Leading the News
NFIB Files Amicus Brief at Supreme Court Challenging California Regulation With Nationwide Impact
The case questions the constitutionality of California’s Proposition 12 regulation
WASHINGTON, D.C. (June 21, 2022) – NFIB filed an amicus brief at the U.S. Supreme Court in the case National Pork Producers Council v. Karen Ross. NFIB’s brief argues that California’s Proposition 12 imposes onerous regulations on pork producers nationwide and violates the Commerce Clause of the Constitution.
“California’s Proposition 12 is a threat to small businesses not only in California but nationwide,” said Karen Harned, Executive Director of NFIB’s Small Business Legal Center. “If the Court upholds Proposition 12, it will rubber-stamp the imposition of certain California regulations on every state in the nation to the economic detriment of millions of small businesses just trying to keep their head above water. NFIB urges the U.S. Supreme Court to reverse the Ninth Circuit’s decision.”
The case concerns the constitutionality of California’s Proposition 12, which regulates the conduct of pork farmers, processors, wholesalers, and retailers nationwide. NFIB’s brief argues that allowing states to impose their own policy preferences on these industries nationwide will fracture national markets into regional and local affairs, which is a great concern to small businesses.
NFIB filed the brief with the National Association of Manufacturers and the National Cattlemen’s Beef Association.
Viking River Cruises v. Moriana decision will help curb frivolous litigation
WASHINGTON, D.C. (June 15, 2022) – The National Federation of Independent Business (NFIB) applauds today’s decision from the U.S. Supreme Court in the case Viking River Cruises, Inc., v. Angie Moriana. NFIB filed an amicus brief in the case urging the Court to reaffirm the Federal Arbitration Act’s (FAA) protection of individualized arbitration.
“Small businesses greatly benefit from arbitration as it is a fast and inexpensive way to solve business issues and avoid costly litigation,” said Karen Harned, Executive Director of NFIB’s Small Business Legal Center. “The Supreme Court’s affirmation that the FAA’s pro-arbitration mandate should apply to individual California Private Attorneys General Act (PAGA) claims will go a long way in protecting small businesses from an onslaught of PAGA litigation, including many frivolous lawsuits, brought under PAGA and similar state laws.”
The case questioned whether the FAA requires enforcement of bilateral arbitration agreements stipulating that an employee cannot raise representative claims, including under PAGA. Among other things, NFIB’s brief highlighted plaintiff bar abuse of PAGA to shakedown California employers.
The NFIB Small Business Legal Center protects the rights of small business owners in the nation’s courts. NFIB is currently active in more than 40 cases in federal and state courts across the country and in the U.S. Supreme Court.
Inflation continues to be No. 1 problem as owners raising selling prices matches record high
WASHINGTON, D.C. (June 14, 2022) – The NFIB Optimism Index fell 0.1 points in May to 93.1, marking the fifth consecutive month below the 48-year average of 98. Owners expecting better business conditions over the next six months decreased four points to a net negative 54%, the lowest level recorded in the 48-year-old survey. Expectations for better business conditions have deteriorated every month since January.
Twenty-eight percent of owners reported inflation was their single most important problem in operating their business, a decrease of four points from April. The net percent of owners raising average selling prices increased two points to a net 72% (seasonally adjusted), back to the highest reading in the 48-year-history of the survey last reached in March and 32 points higher than May 2021.
“Inflation continues to outpace compensation which has reduced real incomes across the nation,” said NFIB Chief Economist Bill Dunkelberg. “Small business owners remain very pessimistic about the second half of the year as supply chain disruptions, inflation, and the labor shortage are not easing.”
Small Business to U.S. House and U.S. Senate, “Do No Harm”
“Any policy should be evaluated as ‘how will this impact small business optimism?’ and ‘how will this impact consumer confidence?’”
The small business half of the economy is extremely important to the nation’s economic recovery, and Main Street is battling rising inflation and labor shortages. To avoid worsening current conditions for small business, NFIB and small business owners across the nation are urging the Biden Administration and Congress to evaluate any policy with questions like ‘how will this impact small business optimism?’ and ‘how will this impact consumer confidence?’
In a recent segment on C-SPAN’s Washington Journal, NFIB Vice President of Federal Government Relations Kevin Kuhlman discussed some of the issues impacting small businesses right now.
“Small businesses are flashing yellow warning lights,” Kuhlman explained. “The small business half of the economy is extremely important to the economic recovery. Our research shows that inflation is really taking its toll on small businesses. It’s the top small business problem for one-third of small business owners – a year ago it was low single digits. That’s in addition to workforce shortages, supply chain disruptions, and it’s really concerning that as our research shows, expectations for better business conditions in six months are the lowest they’ve been in the nearly 50-year survey.”
NFIB Statement On Inflation and Its Impact On Small Businesses (05/17/2022)
WASHINGTON, D.C. (May 11, 2022) – The National Federation of Independent Business (NFIB), the nation’s leading small business advocacy organization, released the below statement in response to the Bureau of Labor Statistics report on Consumer Price Index and inflation’s impact on small businesses:
“Rising inflation has become a serious detriment for the small business community, and as new data shows, small business owners aren’t expecting business conditions to ease anytime soon,” said Kevin Kuhlman, NFIB Vice President of Federal Government Relations. “Small business optimism is now at its lowest level since April 2020, while most Main Street employers report that inflation is substantially impacting their business. The administration and Congress should not increase the pressure on small businesses with new taxes and mandates but instead promote policies that would grow and strengthen the small business economy.”
NFIB’s recent monthly survey shows nearly a third of small businesses reported inflation as their single most important business problem. Owners expecting better business conditions in the next six months dropped to the lowest level ever recorded.
Restaurant Law Center v. Department of Labor concerns FLSA tip credit provision
NEW ORLEANS, La. (May 17, 2022) – NFIB filed an amicus brief in the case Restaurant Law Center, et al. v. United States Department of Labor at the United States Court of Appeals for the Fifth Circuit. The case challenges DOL’s 2021 final rule on the Fair Labor Standards Act (FLSA) tip credit provision.
“The current rule from the Department of Labor creates many administrative burdens for small employers with tipped workers,” said Karen Harned, Executive Director of NFIB’s Small Business Legal Center. “The department is exceeding its rulemaking authority on this issue and ultimately creating onerous and unworkable regulations for small business owners.”
NFIB’s amicus brief argues that the rule, which attempts to limit when employers can use the sub-minimum wage, or tip credit, conflicts with the FLSA and makes compliance nearly impossible for small business owners. The rule offers conflicting guidance on how employers should categorize tip-producing work and imposes significant time-keeping issues. NFIB asks the Fifth Circuit to reverse the district court’s decision and remand to the district court with instructions to enter a preliminary injunction enjoining the Department from enforcing the final rule pending final judgment in the case.
NFIB filed the amicus brief with the National Retail Federation, American Hotel and Lodging Association, and American Gaming Association.
Supreme Court Shields Small Businesses from Oppressive Energy Regulations
WASHINGTON, D.C. (June 30, 2022) – The National Federation of Independent Business (NFIB) commends today’s United States Supreme Court decision in the case West Virginia v. Environmental Protection Agency. The Court agreed to reverse the lower court’s decision, which drastically increased the Environmental Protection Agency’s (EPA) authority to address climate change without clear Congressional approval. Contrary to the lower court, the Supreme Court held that Section 111 of the Clean Air Act did not give EPA authority to transform the nation’s electricity grid, and that such a decision must come from Congress itself or an agency acting upon a “clear delegation” from Congress.
“Small businesses are relieved with today’s decision from the U.S. Supreme Court,” said Karen Harned, Executive Director of NFIB’s Small Business Legal Center. “Energy costs are a large expense and a top concern for small businesses. The Supreme Court made the correct decision today by reining in the EPA’s overreach and requiring clear Congressional approval for expansive regulations affecting the entire energy industry.”
NFIB filed an amicus brief in the case arguing that the EPA needed clear authorization from Congress before imposing costly and significant regulations on the energy sector...
Congress Can Help Small Businesses Fight Inflation
NFIB President Brad Close wrote a new op-ed in Fox Business explaining how Congress can help Main Street fight inflation. Last week, the Bureau of Labor Statistics report on the Consumer Price Index reported inflation is near a 40-year high. Close explains that inflation is the number one problem facing small businesses right now, as reported in NFIB’s monthly survey.
“Small businesses are counting on Washington to help address this crisis, but instead of solutions, all they hear are bad ideas that will make current problems even worse. Congress and the Administration are still pushing the Build Back Better Act legislation, with its massive tax increases that would take more money that small businesses need to grapple with high inflation and supply chain bottlenecks.”
“Only in Washington does it make sense to saddle the small business economy with new taxes and mandates. What’s really needed are policies that would grow and strengthen Main Street. If Congress doesn’t have any good ideas, they should look to the states for pro-growth solutions.”
NFIB: Out-of-Control Rising Inflation Continues To Harm Small Business Recovery
WASHINGTON, D.C. (June 10, 2022) – The National Federation of Independent Business (NFIB), the nation’s leading small business advocacy organization, released the following statement regarding the Bureau of Labor Statistics report on Consumer Price Index for May and inflation’s continued impact on small businesses:
“With inflation reaching a near 40-year high, small businesses continue to be plagued by rising prices with little hope for relief on the horizon,” said NFIB Vice President of Federal Government Relations Kevin Kuhlman. “As recent data shows, inflation remains the top problem for one-third of small business owners, has a direct impact on small business optimism, which is at a near 50-year low, and continues to harm the small business recovery. With the detriment of inflation, worker shortages, and supply chain disruptions, the Biden administration and Congress must adopt a do no harm approach and rule out any tax increases and mandates on small businesses, and specifically promote policies that would strengthen the small business recovery.”
NFIB May Jobs Report: Over Half of Small Businesses Have Unfilled Job Openings
WASHINGTON, D.C. (June 2, 2022) – According to NFIB’s monthly jobs report, the labor shortage continues to be a challenge for small businesses with 51% (seasonally adjusted) of owners reporting job openings they could not fill in the current period, up four points from April and matching the 48-year record high set in September. Twenty-three percent of owners reported labor quality was their top business problem, second to inflation. Twelve percent of owners cited labor costs as their top business problem.
“The labor force participation rate is slowly rising but small businesses continue to have a hard time filling their open positions,” said NFIB Chief Economist Bill Dunkelberg. “The number of job openings continues to exceed the number of unemployed workers which has produced a tight labor market and added pressure on wage levels.”
Overall, 67% of owners reported hiring or trying to hire in May, up eight points from April. Ninety-two percent of those owners hiring or trying to hire reported few or no qualified applicants for the positions they were trying to fill. Thirty-three percent of owners reported few qualified applicants for their open positions and 28% reported none.
Seasonally adjusted, a net 49% of owners reported raising compensation, up three points from April and one point below the 48-year record high set in January. A net 25% of owners plan to raise compensation in the next three months.
Inflation Rising At Fastest Pace In Decades
The AP (4/12, Wiseman) reported that inflation “soared over the past year at its fastest pace in more than 40 years,” according to new Consumer Price Index data released by the Department of Labor on Tuesday. Overall, the CPI was up 8.5% in March over a year earlier, while the core CPI, which excludes volatile food and energy costs, rose 6.5% during the same period.
Recession Fears Grow Amid Rising Inflation.
The Hill (4/14, Folley, Lane) reported that “fears are growing that a recession is around the corner” as “Americans feel the squeeze of rising inflation.” The economy “is running hot as a record stretch of job growth, steady consumer demand and intense demand for labor has helped fuel the highest inflation rate in 40 years. While the economy has recovered far quicker than many economists expected, the speed of the rebound is putting pressure on the Federal Reserve to take more significant action to help slow price growth.” Wendy Edelberg, “director of The Hamilton Project and a senior economic studies fellow at the left-leaning Brookings Institution,” and other economists say that “in order to combat the skyrocketing inflation...a slowdown is vital.” Edelberg said, “So, now the question is, how smoothly does that slowdown happen? ... And slowdowns can be painful. So, there’s absolutely a risk of a recession.”
Small Business Marketing
Expert Criticizes Email For Customer Communication, Says Texting Is Superior
In a USA Today (4/14, Deerwester) column, lawyer, speaker, and author Steve Strauss wrote that “email is actually a fairly horrible way for business generally, and small business, in particular, to communicate with customers. Unopened and unwanted, ignored and abandoned, emails simply don’t get through anymore.” Strauss went on to argue that texting is superior to emailing.
Tips Offered For Small Business To Craft Effective Brand Experience
Small Business Trends (4/9, Pilon) provided “10 tips for creating an effective small business brand experience.” Among the areas small business owners should consider are creating an appealing logo, crafting a brand voice, and improving website design.
Marketing Challenges Facing Small Business Owners Highlighted
Startup. Info (4/15) highlighted marketing challenges small business owners find themselves confronted with as well as how to deal with said challenges. One of these challenges is content distribution, with Startup. Info saying that content distribution “entails the practice of spreading your content far and wide. But we must state that it’s also a very challenging aspect of marketing.” With regard to how to deal with this challenge, Startup. Info says, in part, “Have a detailed content calendar that shows when, where, and how you spread your content.”
Commentary: QR Codes Can Help Business Owners “Bridge The Gap” Between Traditional, Digital Marketing
Michael Plummer, Jr., president of “premier New Mover Marketing franchise” Our Town America, wrote in Forbes (3/30, Plummer) that businesses should “bridge the gap between traditional and digital marketing by learning how to use QR codes as part of your print marketing strategy.” Plummer wrote, “Using QR codes in your marketing materials can help your business connect with customers and drive traffic to your website,” as well as help build an email database to “stay in touch with your loyal customers” and boost customer feedback.
Small Businesses Advised To Shift Social Media Strategy To Cope With Instagram Priority Change
Insider (3/28, York) reported that in late 2021, Instagram “announced a shift to prioritizing video-focused content over photo-focused content,” and “small businesses and creators [said] that the frequent updates and changes make it difficult to grow their accounts, especially those rooted in photo content.” Social media coach Kar Brulhart “add[ed] that Instagram’s algorithm is prioritizing video and reels to compete with YouTube and TikTok,” and advised entrepreneurs to “create stop-motion reels to showcase their products in various frames or film clips to compile into a montage.” Amanda Teo, a director of marketing at the sustainable-packaging company Noissue, “add[ed] that video content produced in-house shouldn’t feel overly produced,” and was quoted saying, “We’ve tested more-produced videos versus more-authentic videos, and the authentic videos that look like you just filmed it off your phone with minimal editing performed really well.”
SBA’s National Small Business Week Set For May 1-7
The Lower Bucks (NJ) Times (3/28) said the Small Business Administration’s “National Small Business Week: Building a Better America Through Entrepreneurship is set for May 1-7.” SBA Administrator Isabella Casillas Guzman said the virtual event “celebrates the resiliency and tenacity of America’s entrepreneurs who are doing their part to power our nation’s historic economic comeback.”
Wages and Benefits
NFIB webinar explains the employment process to help recruit and retain workers
On June 1, the “Hiring & Retaining the Best Talent in a Tight Labor Market: HR Basics for Small Business” webinar was hosted by Senior Executive Counsel for the NFIB Small Business Legal Center Elizabeth Milito and Executive Director for the NFIB Research Center Holly Wade.
NFIB’s research shows that small business owners are struggling with workforce shortages. Forty-seven percent of small business owners are reporting they have job openings they could not fill, and an NFIB survey shows expectations for better business conditions in six months is the lowest it’s been in the nearly 50-year survey.
“While the last two years really demonstrated how resilient and important small businesses are to our economy, I would say that small businesses run America, the pandemic also showed some inefficiencies and deficiencies in businesses,” Milito explained. “Small business and larger businesses too, particularly when it comes to issues related to recruitment and retention of employees.”
For small business owners, it is important to re-examine the processes that are being used for recruiting employees and finding new and effective ways to retain employees.
Wages Not Keeping Up With Inflation
CNBC (4/12, Cox) reported that because of the “surge” in inflation, “real earnings, despite rising 5.6% from a year ago, weren’t keeping pace with the cost of living. Real average hourly earnings posted a seasonally adjusted 0.8% decline for the month, according to a separate Bureau of Labor Statistics report. The inability of wages to keep up with costs could add to inflation pressures.”
Jobless Claims Up Last Week, But Remain At New Historic Lows
The AP (4/14, Wiseman) reported that first-time claims for jobless benefits rose 18,000 last week to 185,000, according to Department of Labor data released Thursday, but “remained at a historically low level, reflecting a robust U.S. labor market with near record-high job openings and few layoffs.” The four-week moving average, which irons out week-to-week volatility, rose 2,000 to 172,000.
Research: 3M Americans Unwilling To Return To Pre-Pandemic Work
The Wall Street Journal (4/16, Mitchell, Subscription Publication) reported new research shows 3 million Americans who quit work during the coronavirus pandemic do not plan to return to pre-pandemic activities even after all restrictions are lifted. According to researchers, these people tend to be women, lack a college degree, and work in low-paying jobs. Th Journal warned that the persistence of “long social distancing” means the labor force is unlikely to bounce back to pre-pandemic levels.
House Democrats Introduce Bill To Require Companies Provide Time Off For Voting
Reuters (4/11, Warburton) reported House Democrats on Monday “proposed legislation requiring employers give their workers paid time off to vote, following failed attempts by Congress to pass major voting rights legislation earlier this year.” In a statement, Rep. Nikema Williams (D-GA) said that the “Time Off to Vote Act” would help states reduce lines at polling places, while Rep. Andy Levin (D-MI) said it would “ensure no worker has to sacrifice their wages or jeopardize their job security to exercise their sacred right to vote.”
Jobless Claims Fall To Lowest Level Since November 1968
The Wall Street Journal (4/7, Rubin, Subscription Publication) reported that the Labor Department said last Thursday that initial jobless claims fell to 160,000 during the week that ended April 2, compared to a revised 171,000 the week before. It was the lowest weekly total since November 1968, when the labor force was less than half the size it is now.
Reuters (4/7, Mutikani) said the numbers are “indicating a further tightening of labor market conditions...which could contribute to keeping inflation elevated.” The decline in claims is at “a more than 53-year low” in part due to “a revision of the seasonal factors.” Nationally, “big declines in claims in Michigan and Texas...offset increases in California, Ohio and Pennsylvania.”