1. Virginia’s Economic Future
Small Business Perspective
Nicole Riley, National Federation of Independent Business
September 13, 2016

2. National Federation of Independent Business
The National Federation of Independent Business is the leading small business association representing 325,000 small and independent businesses nationwide and 6,600 in Virginia.
A nonprofit, nonpartisan organization founded in 1943, NFIB represents the consensus views of its members in Washington, D.C., and all 50 states

3. Political Wrangling Inside the Beltway

4. May 2015 Report – Moving Forward One Slow Step at a Time
LAST YEAR
May 2015 Report – Moving Forward One Slow Step at a Time

5. MAY 2015
“Small Business Economic Trends” Report

6. September 2016 - Political Climate as Negative Factor Hits Record High
THIS YEAR
September Political Climate as Negative Factor Hits Record High

7. SEPT 2016
“Small Business Economic Trends” Report

8. Most Notable Comparisons Change from Prior Month
Plans to Increase Employment
Net %
Change from Prior Month
May 2015
12% 1
Sept 2016 9% -3

9. 2. Expect Economy to Improve
Net %
Change from Prior Month
May 2015
-3% 3
Sept 2016
-12% -7

10. 3. Expect Real Sales Higher
Net %
Change from Prior Month
May 2015 7% -3
Sept 2016
-1% -2

11. 4. Now a Good Time to Expand Change from Prior Month
Net %
Change from Prior Month
May 2015
14% 4
Sept 2016 9% 1

12. Change from Prior Month
5. Earnings Trends
Net %
Change from Prior Month
May 2015
-7% 9
Sept 2016
-23% -2

13. Optimism Index since 2011 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
2011
93.9
94.7
92.4
90.9
90.5
91.2
90.2
87.9
88.9
91.8
93.7
2012
94.5
93.1
94.2
94.0
91.9
91.5
92.7
93.0
87.2
88.0
2013
88.8
90.0
91.7
94.4
93.8
92.2
2014
91.6
94.8
96.2
95.4
96.0
95.9
95.3
97.8
100.3
2015
97.7
98.1
95.7
96.5
98.3
94.6
95.2
2016
92.9
92.6
93.6

14. Single Most Important Problem Facing Your Business
Current
Last Year
Survey High
Survey Low
Taxes   21 20 32 8
Govt. Regs. & Red Tape 27 4
Poor Sales 11 14 34 2
Quality of Labor 15 24 3
Cost of Labor 9 5
Cost/Avail. of Insurance 29
Comp. From Large Bus. 7
Other 31 1
Fin. & Interest Rates 37
Inflation 41

15. Challenges Facing VA Small Businesses
Uncertainty at the Federal Level
Federal Tax Policy
Healthcare
Regulation Tsunami
Labor
Environment
Virginia Challenges
Tax Reform
Budget Shortfall

16. Tax
As Congress considers broad-based tax reform, NFIB continues to work with lawmakers to ensure the small business tax priorities are central to the debate.
High tax rates and the complexity of the current tax code are persistent problems for small business owners.
Fundamental tax reform is one way that Congress can create an economic environment which helps small businesses

17. Healthcare
Employer mandate coverage requirement is fully implemented for “mid-size” and “large” businesses. Businesses with 50 or more full-time or full-time equivalent employees are mandated to offer health insurance to at least 95 percent of full-time employees (and dependents) or pay

18. New Overtime Rules
Who?
Currently, DOL estimate 8% of the workforce is overtime-eligible.
Under new rule, DOL says the number would jump to nearly 40%.
That means that 4.6 million more people would become overtime eligible.
NFIB estimates rule will impact nearly 40% of its members.

19. New Overtime Rules What?
The proposal called for the salary threshold for an employee to be exempt from overtime to increase to $47,476 (from $23,660) per year.
For the first time ever, the salary threshold will be tied to an automatic escalator tied to the 40th percentile of weekly earnings for full-time salaried workers OR increasing it with inflation by tying it to the Consumer Price Index.

20. New Overtime Rules
When?
December 1, 2016

21. New Overtime Rules Q: How . . .the heck? A:
Whether employers pay additional overtime or adjust salaries to avoid overtime, compliance is going to be expensive.
NFIB.com/overtime for resources and FREE compliance webinar.

22. “How can you be a manager and punch a time clock
“How can you be a manager and punch a time clock? The idea is to do a job, not keep track of your hours. A manager’s income is based on results and profits, not hours worked. This is the antithesis of building a management mentality or in training someone to be a manager. It would also disrupt the workplace and lead to fewer management opportunities. It would hurt, not help, the people they claim to want to help.”
Robert Mayfield, Austin restaurateur and NFIB Member

23. Environment
EPA and Army Corp issued a new “Waters of the U.S.” (WOTUS) rule.
The Rule radically expands Clean Water Act (CWA) jurisdiction.
Creates a presumption of jurisdiction for land with any wet features.

24. Environment
The Agencies claim the Rule results in only a modest 3% increase in CWA jurisdiction.
At the same time—they assert the Rule provides new protections for 1/3rd of America’s waters.

25. Environment
EPA has identified 8.1 million miles of rivers and streams that will be identified as new “waters of the United States.”
In Kansas alone, the Rule results in a 400% expansion in CWA jurisdiction.

26. THANK YOU! Nicole Riley Virginia State Director
National Federation of Independent Business
(804)