Small business’ biggest challenge: regulations
Many entrepreneurs start their own businesses because they want the freedom that comes along with owning a small business. They want to be a part of something they’re passionate about. They want to define themselves and their professional lives on their own terms and not on the terms of a micromanaging boss. It’s estimated that over 89% of all businesses within the United States are actually classified as small businesses. That’s a huge majority that speaks volumes about the path that this country is on. However, being a part of small business isn’t all positive. Because of current government regulations and taxes, small businesses are suffering and suffocating.
ChamberofCommerce.com published a report1, asserting that government mandated regulatory costs are fixed costs and not necessarily based on the number of employees. This means that a company with just a handful of employees pays the same fees as a company with thousands of employees. The current regulations don’t account for the limited budgets of a small business with a few employees.
Instead, it ultimately rewards bigger companies than small homegrown businesses. Twenty-two percent of polled business owners said that their biggest professional challenge is complying with these regulations and taxes, and that was their number one complaint and struggle with owning their own business.
The burden on small businesses
When the small business regulations and taxes are broken down, the direct burden on business amounts to about $970 billion. When broken down even more, ChamberofCommerce.com found that companies are basically paying $8,000 per employee and $161,000 as a total company. That’s enough to shut a struggling business down for good. And many entrepreneurs only get a few shots at professional success to match or exceed their goals.
Entrepreneurs across the country are trying their hands at success and finding ways to incorporate their passions, interests, and skills into their professional lives. And while entrepreneurs are encouraged to build their small businesses, current federal regulations make it nearly impossible for many businesses to survive and thrive.
The only immediate solutions are to foot the bill or hire more employees to qualify for more tax breaks. But that’s not always a smart move. Instead, the federal regulations themselves need to change and that will require the collaboration and persistence of all small business owners.