US President Joe Biden will meet with CEOs of companies in various fields at the White House in Washington on November 29, 2021 to discuss the holiday shopping season.
Kevin Lamarck | Reuters
The politics of small business owners resembles the politics of the majority of Americans in one main respect: it has become bipartisan. However, President Joe Biden’s approval rating among entrepreneurs has fallen to a record low, and mainstreet confidence is close to the lowest ever set in the first quarter of 2021, when President Biden’s inauguration began. The president’s economic treatment because he returned.
latest CNBC | Momentive Small Business Survey Shows a decline in SME credibility and Biden’s approval rate, with respondents saying that independent companies are primarily responsible for the downshift, and concerns about inflation in the data. It has a big influence.
Surveys show that while concerns about labor shortages remain high, more small business owners are experiencing rising prices and supply chain disruptions. Seventy-five percent of small business owners say they are experiencing supply costs up from 70% in the third quarter. 58% are experiencing supply chain disruptions, up from 55%.
Inflation is at the top of the list of concerns, with 34% of small business owners citing inflation as the number one risk to their business, followed by supply chain disruptions (23%) and Covid (17%). increase. The survey was conducted by Momentive between November 10 and 16, 2021, before the news of the Omicron variant, with 2,078 self-identified small business owners.
Currently, only 34% of small business owners approve how Joe Biden treats his duties as president. This was down from 40% in the third quarter (43% in the first quarter). Most of the decline was among independents. 33% approved Biden, down from 51% in the third quarter. There was minimal quarterly approval movement between Republicans (9%) and Democrats (89%).
SME confidence remains very partisan. The Democratic SMEs have a confidence index of 62, while the Republicans have a confidence index of 35. Twice as many Republicans (40% vs. 20%) as Democrats who own small businesses say inflation is their number one concern. However, only 22% of small business owners say the Biden administration is good for small businesses, and 62% say it is bad for small businesses. For independent businesses, 59% say Biden has a negative impact on SMEs, and 60% of independent SME owners say Biden has a negative impact on the economy.
The view from the main street is consistent with a parallel survey of more than 9,000 non-small business owners conducted by Momentive for CNBC. This shows only 21% of the Independent Party and 65% of the Democrats, saying Biden is good for the economy.
“”Laura Wronski, senior manager of research science at Momentive, said, “Given that President Biden’s national poll approval is also low, it’s not surprising that approval rates are down. It’s interesting to lose the most. The ground among the independents. Democrats are sticking to him and Republicans are less opposed to him than in the previous quarter. This is the general public. It applies to small business owners as well as people. “
In addition to the broader polls, CNBC | Momentive survey data are consistent with other data Recent research from the small business community..
The National Federation of Independent Businesses sees labor concerns remain high in monthly surveys, but not as serious as supply chain and price concerns.
A recent NFIB Covid survey conducted at the end of October found that more and more small business owners have stated that supply chains are their number one concern. Holly Wade, Executive Director of the NFIB, said: research. “It’s a lot of stress,” she said.
While consumer spending is strong, the ability of SMEs to earn spending is becoming a bigger issue, and both supply chains and labor shortages are having a significant impact on sales opportunities. “This is a big problem and very frustrating,” Wade said.
In a late October survey, 19% of small business owners said they lost sales as a result of supply chain problems. The majority of small business owners (69%) told the NFIB that they raised their average selling prices because of supply chain or employment costs, and more than one-third said they raised prices by more than 10%. Just under one-third (30%) of small business owners told the NFIB that they didn’t know when prices would return to “more normal” levels, Wade said. “It’s a lot of uncertainty,” she said.
“Inflation is the biggest question in the economy today,” Wronski said. “I really don’t know what’s going to happen next in terms of price increases. It’s a very difficult place for small businesses. As prices continue to rise, small business owners will bring those costs to consumers to the extent they’ve been. You’ll have to pass it on, but if they raise their prices faster (faster than their competitors), they’ll lose customers. “
The NFIB optimism index remains close to the long-term historical average (48), but some indicators within the index have turned even more negative, including views on economic conditions over the next six months. And among small business owners, it is approaching a record level, saying that the business situation will deteriorate. “It’s a feeling of pervasiveness,” Wade said. “When inflation is happening to you, it’s not temporary, it’s frustrating.”
According to Gallup, Biden’s approval rate among the general public has dropped to 42% from the summer, a combination of Covid’s sustainability and Afghanistan’s withdrawal, sending it to unrecovered lows by September. This has caused previous inflation concerns. Inflation is likely to be a factor in Biden’s low approval rate, even if Afghanistan is no longer the main headline, according to Gallup editor-in-chief Geoff Johns.
“I don’t know if inflation is hitting more than Afghanistan, but it all feeds on the story of a less capable government,” Jones said. “It’s not rebounding and inflation is a bigger problem.”
Similar to CNBC’s investigation, Jones said that almost all movements in Gallup’s data are taking place among independents. His administration is important to Biden as it began with a high level of support among this major voter group. According to Gallup, the Independents did not enthusiastically support President Trump, but were enthusiastic about Biden at the beginning of his term. Support has been removed From 61% to 37%.
“Because it’s the country’s largest political block, Biden needs to be very worried,” said Jones, who recognizes that 25% to 28% of Americans are Republicans. rice field. Between 28% and 31% as a Democrat. And 40% as an independent person.
“The rise from 61% to 37% is a pretty big drop among the largest group of voters,” Jones said, and that could have been evidence of recent governor races in New Jersey and Virginia. He added.
Even in a strong economy characterized by record stock markets and high GDP, it is the price on petrol pumps, the media coverage, and tends to further influence public perception.
“Inflation and related gas prices are something people are aware of and have a direct impact, and historically it has been difficult for the president to get a good approval rating when gas prices are high,” Jones said.
Some of Jimmy Carter’s and George Herbert Walker Bush’s lowest presidential approval ratings to date have come during periods of high gasoline prices.
Inflation may not be as great as historical impacts in today’s bipartisan political reality, but “certainly has a greater impact than unemployment, stock market and GDP declines,” Jones said. .. “When we get into this situation, when good and bad economic data are mixed and can be discussed in either way, partisanship is a more important factor and you emphasize. What you are doing can be a more important factor, “he says. Said.
However, partisanship does not convey the big picture.
Gallup asks Americans if the economy is getting better or worse, and if the public thinks it’s “quite negative.” The Democrats aren’t too negative, but it’s hard to say that the Democrats are getting better. According to Gallup, half (50%) of Democrats say their economies are improving and 45% say they are getting worse. Among Democrats, that sentiment reading has fallen from 76% in June.
“You want it to be 90%,” Jones said. “Economic reality is a bit of a check on pure partisanship.”
According to Gallup data in November, 28% of independent companies said their economies were improving, 67% said they were deteriorating, and in June they said their economies were improving45. It is decreasing from%.
And inflation appears in another important Gallup question.It asks Americans what they are looking at The most important issue, According to Jones, it’s a free-form question, with inflation reaching 7%, which is a high level for a free-form question. “I have to say something from the top of my head,” he said.
The government and Covid maintain the number one and number two answers to this question, but inflation rose between 1% and 2% in August and September, and Gallup’s during high-priced periods. It remains low compared to the polling history. “If inflation continues, there is room for it to rise in the coming months,” Jones said.
The negative view of President Byden’s economic policy is that he is trying to pass his major buildback better bill, which includes tax increases for businesses and the wealthy, and that the small business community is more towards government policy. It happens when you are negative. Three major SME credibility index indicators related to government regulation, tax policy and trade policy are more pessimistic on CNBC | Momentary quarterly survey dating back to 2017.
Main Street strongly opposes Biden’s infrastructure and buildback better bills, while 36% of small business owners say the infrastructure bill has a negative impact on their business. Only 24% said they would have a positive impact. .. A small percentage (52%) of small business owners do not believe that any element of the Build Back Better bill will help their business.
There is support for some measures within the law, 21% say building more affordable homes will help their business, and 20% say the expansion of Medicaid / Medicaid will help. Just under one-fifth (19%) say higher taxes on income above $ 10 million help businesses, and 17% of small business owners have a minimum corporate tax of 15% on businesses. It says it will be useful.
Wade is a small business owner by focusing on regulatory and tax increases when labor shortages and supply chain disruptions make it difficult to run businesses that already handle high prices. Said that the stress would increase.
An optimistic view of the main street is important in the CNBC | Momentive survey.
Despite shocks to the system such as inflation, supply chain disruptions and layoffs, there is no real threat to small business owners like last year’s Covid crisis. Studies show that Omicron variants show new uncertainties, but more small business owners than at any time before 2020-2021 survive another year under current circumstances. It states that it can be done.
“This is evidence of the resilience these SMEs have developed since March 2020, but it’s also an optimistic reminder for 2022,” Wronski said.
The latest signs of President Biden’s inflation problem are on the main street
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