Survey of 6,000+ small business professionals highlights their concerns about taxes, regulations, health care, and access to credit
Congress and President Donald J. Trump’s administration have made clear their intention to reform the tax system, overhaul health care delivery, and streamline regulations. These policy changes will directly affect our nation’s small business owners, who are the backbone of the U.S. economy. We at Thumbtack asked our small business owners (or as we like to call them, pros) about their policy priorities and concerns, and here’s what they had to say:
- Tax Reform: Pros continue to cite tax reform as a policy priority, but they aren’t calling for a corporate income tax break or a reduction in the number of personal income tax brackets.
- Regulations: Nearly two-thirds of pros are satisfied with the level of regulation in their industry, and yet only half say the regulations they comply with are easy to navigate.
- Credit Markets: More than half of pros say it’s too hard to get credit and want the federal government to incentivize banks to lend more to small businesses.
- Health Care: A majority of pros receive insurance coverage through Medicare or the Affordable Care Act.
- Paid Leave: Over half of pros would not be able to take time off if there was a childbirth or adoption in their family.
Survey Background and Methodology
These data were collected in the January version of our monthly Economic Sentiment Survey, which captures the economic attitudes and perspectives of small business owners from across the country who use Thumbtack, an online marketplace for local services, to find new customers. Originally designed in coordination with economists at Bloomberg, Thumbtack’s Economic Sentiment Survey uniquely captures a ground-level view of the economy in all 50 states. This month, we received responses from 5,842 business owners between January 20-29, through our online, in-product survey portal. These business owners work in a variety of service-based industries, with occupations such as general contractor, interior designer, photographer, and personal trainer. They are demographically and politically diverse: over 30% are non-white, 40% are female, and there are a near-identical number of self-identified Democrats and Republicans (24.65% and 24.32%, respectively).
Regulations Are Complex
Much of the recent political discourse surrounding regulation has focused on the amount of regulations facing businesses; our survey results suggest this is not small business owners’ biggest concern. Almost two-thirds of Thumbtack pros are satisfied with the level of regulation in their industry, and just 20% describe current regulations as overly burdensome. In fact, 14% of pros indicate that their industry is not adequately regulated.
Thumbtack pros are more concerned about regulatory complexity. Only half of Thumbtack pros consider the regulations with which they comply to be “somewhat” or “very” easy to navigate. This is particularly important for policymakers to keep in mind; small business owners name regulatory complexity as the leading detractor to perceived government friendliness.
Overall, 69% of Thumbtack pros want regulatory reform. Twenty-two percent of our survey respondents name employment and labor laws as their highest priorities for regulatory reform. Additional priority areas include occupational licensing (16%) and environmental rules (12%).
Tax Reform: A Priority, but Not the Way You’d Expect
Regulatory reform is not the only area on Thumbtack pros’ minds. Twenty-eight percent of pros say that tax reform should be President Trump’s top policy priority. However, the pros’ tax reform priorities do not always align with the priorities of their elected officials. Less than a quarter of Thumbtack pros indicate there are too many federal personal income tax brackets, and 15% of respondents call for more tax brackets.
The greatest percentage of Thumbtack pros (46%) think the top corporate income tax bracket is “about right” at its current level of 35%. Of the remaining pros, 24% believe the current rate is too low, and 30% believe it is too high. We will continue to track pros’ sentiments toward tax reform as the debate develops in Washington.
Credit Is Hard to Find
Thumbtack pros have expressed frustration with the difficulty and cost of acquiring credit. Fifty-two percent of Thumbtack pros believe credit is currently too challenging to acquire, and, as a result, believe that the federal government should incentivize banks to lend more to businesses like theirs.
This issue is directly inhibiting some of our pros’ ability to invest in equipment, hire employees, or expand their businesses’ reach. Of the 42% of Thumbtack pros who wanted to acquire credit in the past three months, only 24% of this group (10% of the overall sample) actually received most or all of the amount they needed.
Thumbtack pros are less concerned about the threat of rising inflation. Only 12% believe the Federal Reserve should raise rates in 2017, while 56% believe they should not, and 32% have no opinion or are unsure.
In addition to regulatory and tax reform, Thumbtack pros would likely support policies that establish paid family leave. This issue resonates with a majority of pros, considering 64% say they could take no time off of work if there were a childbirth or adoption in their family—a rate nearly identical for both male and female pros.
Pros are split, however, on the mechanics of family leave for independent workers. Thirty-two percent say the government should not play a role in providing paid leave for independent workers, while 44% say independent workers should receive paid leave if they contribute to an unemployment insurance fund.
When it comes to insurance, federal decisions about the future of healthcare will directly impact our pros. Over half of our pros have healthcare coverage through either an exchange created by the Affordable Care Act (29%) or by Medicare (31%). We look forward to diving further into pros’ views on healthcare soon.
Thumbtack connects thousands of small business owners to local customers every day. Our relationship with these pros enables us to understand which policy issues matter most to small business owners, and where they stand on issues.
As our political leaders debate various policy reforms, we will continue to solicit reactions from small business owners across the country. We are lucky to have a unique understanding of the policy issues that are most consequential to the small business community’s success. By continuing to share their insights, we hope policymakers consider the perspectives of this critical segment of the U.S. economy.
Our next policy report will focus on how our pros are thinking about potential changes to the Affordable Care Act (ACA). Many of these pros have used the exchanges set up by the ACA to acquire health insurance for themselves and their families and are therefore quite worried about changes to the law. However, many others, particularly those with employees, see the ACA as burdensome and want the law reformed. Our report will take a deep dive into these diverging perspectives within the small business community.