Small businesses on the payroll tax cut

Joe Raedle/Getty Images

Whether or not Congress decides to extend the payroll tax cut, the uncertainty could affect small businesses.

Marketplace for Tuesday, December 20, 2011

Kai Ryssdal: After teasing us yesterday, Republicans in the House made good on their threats over the payroll tax cut today. They voted down the Senate's two-month extension of the tax break and of unemployment benefits.
We were trying to figure out a way to cover this story that wasn't just who did what to whom, so here's what we did. We called some small business owners and played 'em this piece of tape. Speaker of the House John Boehner yesterday, laying out what's been the Republicans' stated reason for voting no.

John Boehner: A two-month extension creates uncertainty and will cause problems for people who are trying to create jobs in the private sector.

And then we asked business owners whether that was true.

My name is Tim Reynolds, I own Tribute Inc.; we're a software development firm in Hudson, Ohio. I think it's an example of the uncertainty that Congress in general, and for that matter, the administration has created over the last several years. I think that he's right that a two-month extension is essentially meaningless, both to employees and to employers. I don't know what the answers are. And I'm not particularly partisan; I think the political finger-pointing is very childish. I'd like to knock heads, you know, and say OK, sit in a room and figure it out.
My name is Viki Honeyman, I own a gallery gift shop in Ann Arbor, Mich., called Heavenly Metal. I actually am the main employee; I do everything, and then I have a handful of part-time people. All of the uncertainty in Washington is hard for small businesses because we're at the bottom of the feeding pool. And all of these decisions, especially what affects us tax-wise, what allows us to either hire or lay off people or invest more money into our businesses, is so much determined by how Congress and the Senate votes. So it's frightening, absolutely.
My name is Peter Rossing, I own Muse Art and Design in Portland, Ore. We are a small art supply store; we have, in addition to myself, three employees. It's really not -- in my case, as a small business owner, I stick to my plans on what I need to do to serve my customers and keep my employees going sort of regardless of immediate uncertainty or changes.

Back to Viki Honeyman in Ann Arbor, Mich., for a minute. Forget tax policy, she told me. What she really needs, Congress can't give.

Honeyman: Well, we need it to snow. Seriously. Tomorrow's supposed to be close to 50, and in order to get people out really in the Christmas mood, we need winter weather.

Tim Reynolds and Viki Honeyman are part of the Public Insight Network. If you are a business owner, share your story with the Public Insight Network here.

About the author

Kai Ryssdal is the host and senior editor of Marketplace, public radio’s program on business and the economy. Follow Kai on Twitter @kairyssdal.

dreamjoe - Dec 20, 2011

I tend to agree with Biltimore. I owned a small Engineering fimr for 30 years with about 10 employees. All of my decisions, as far as hiring, expansion,etc were base on business, not on tax breaks. I do have one pet peeve, I often run into and that is people who say theyare small buiness owners and are the one emploeye with several part time employees. From my experience this almost always means contract employees. When I first started my business I would hire a contract employee rather than a new permanent emplyeee . It just did not work out. They have no loyalty, miss assignments, and are alswyas looking for a real (permanent) job. I think the people who employe only contract employees are doomed to failure. If they do not want the bother and expense of having a permanent employee who they will have to schedule work for, rather than just have someone come and go at their whim, they will probably do the same thing with their marketing and gaining new business. In my opinion. they are amateurs and should not be considred small business owners.

Frontporchcafe - Dec 20, 2011

Forget Washington, turn off the TV! Small business should focus on their customers and provide the products and services that people want. The shopping malls around here are full and people are buying for the holidays. If big gov wants to help, lower the employers portion of the payroll tax, and state and local governments should stop looking at sales taxes as their "entitlement ".

billtmore - Dec 20, 2011

I think Karl Rove has petitioned the BBB to insist that small business owners tow the line. COME ON if these payroll tax et al decisions or lack of decisions are influencing your business practices (Hiring) you need to find a different career. You hire when business is good and you need help...you let go when business is down and you don't need all this help. GIVE ME A BREAK!

Wednesday, 21 December 2011