 |
|
|
|||||
Americas small businesses are the backbone of our economy. They create two-thirds of new jobs, power innovation, and anchor communities across the country. But that backbone is under real strain. Rising healthcare costs dominate the headlines, but whats missing from the conversation is how deeply they impact the small businesses that keep our economy running. At Gusto, we see this strain firsthand. Our latest Small Business Jobs Report showed hiring slowed in November as owners continue to navigate higher costs and uncertainty. Rising healthcare premiums arent the only challenge, but theyre making it that much harder to grow and hire with confidence. Since 2022, small business health insurance costs have climbed 23% since 2022far faster than inflation or wage growth. For the smallest employers, those with just two to five employees, the increase is even steeper: up 18%, reaching nearly $8,500 per worker. Looking ahead to 2026, premiums are projected to rise another 9.5%, the sharpest jump in 15 years. Those numbers have real consequences. They show up in delayed hires, scaled-back hours, or founders skipping their own coverage to keep their team insured. SMALL BUSINESSES ARE HOLDING THE LINE Despite the pressure, small businesses are doing everything they can to support their people. More than one in five small employers still offer health insurance. This is a clear reflection of how much they value their teams. That investment pays off. Gustos data shows that employees with health coverage are 25% less likely to quit in their first year, and businesses that offer it are 13% more likely to report no difficulty hiring. Healthcare isnt just a benefitits a competitive advantage and retention tool for these small businesses. That said, its also becoming unsustainable. Every year, more small business owners are forced into impossible choices. They can keep offering coverage and absorb higher costs, drop it and risk losing the people who make their business work, or pass more of the expense on to employees, who may already be feeling stretched. A HIDDEN HEADWIND FOR ENTREPRENEURS Entrepreneurship in America is thriving. More people are starting businesses now than at any point in recent history. But rising healthcare costs are creating a new kind of barrier: They make it harder to start, grow, or hire. For many would-be founders, leaving a traditional job means losing access to affordable coverage. That doesnt always stop them, but it adds risk and limits what they can do once they start. Some stay solo longer than they want to. Others delay hiring. Some take on extra work to cover premiums. In other words, healthcare isnt necessarily halting entrepreneurship, but its most certainly holding it back. Its keeping too many small business owners from growing to their full potential. HOW SMALL BUSINESSES ARE ADAPTING The good news is that small business owners are incredibly resourceful. Theyre rethinking what benefits look like and finding creative ways to offer support. Many are experimenting with level-funded plans, high-deductible options paired with Health Savings Accounts (HSAs), and Health Reimbursement Arrangements that let employees choose coverage that fits their needs. Others are expanding voluntary benefits like dental, vision, or mental health programs that provide real value without breaking the bank. At Gusto, we help small employers find the right mixbecause the best benefits strategy isnt one-size-fits-all. Flexibility and innovation are key. THE SOLUTION: FLEXIBILITY, POLICY, AND INNOVATION Small businesses cant solve this challenge on their own. The U.S. healthcare system was built around large employers, not the millions of small business owners and self-employed workers who drive todays economy. Its time to modernize that system so healthcare is portable, affordable, and built to support entrepreneurship. Congress already has practical solutions within reach. Lawmakers can codify and strengthen Individual Coverage Health Reimbursement Arrangements, which give employers flexibility to help workers buy their own coverage. A temporary tax credit for small businesses offering these plans for the first time would make coverage more affordable and expand access quickly. Congress can also expand HSA eligibility to include Affordable Care Act Bronze and catastrophic plans, giving small employers and their teams the same tax advantages that large companies enjoy. If we want small businesses to keep creating jobs, serving their communities, and fueling our economy, we need to make healthcare affordable for the people behind them. Tomer London is cofounder and chief product officer of Gusto.
Category:
E-Commerce
At a time when Americans are frustrated and angry over the high cost of living, the government released a report Thursday showing that inflation had cooled unexpectedly in November. But economists quickly warned that last month’s numbers were suspect because theyd been delayed and likely distorted by the 43-day federal shutdown. And most Americans have not felt any let up in the high prices they are paying for food, insurance, utilities, and other basic necessities. The Labor Department reported Thursday that its consumer price index rose 2.7% in November from a year earlier. Yet, year-over-year inflation remains well above the Federal Reserve’s 2% target. Americans, dismayed by high prices, handed big victories to Democrats in local and state elections last month. The inflation report was delayed eight days by the shutdown, which also prevented the Labor Department from compiling overall numbers for consumer prices and core inflation in October and disrupted the usual data-collecting process. Thursdays report gave investors, businesses, and policymakers their first look at CPI since the September numbers were released on Oct. 24. Consumer prices had risen 3% in September from a year earlier, and forecasters had expected the November CPI to match that year-over-year increase. Its likely a bit distorted, said Diane Swonk, chief economist at the tax and consulting firm KPMG. The good news is that its cooling. Well take a win when we can get it. Still, Swonk added: The data is truncated, and we just dont know how much of it to trust. By disrupting the economy especially government contracting the shutdown may have contributed to a cooling in prices, she said. Kay Haigh, global co-head of fixed income and liquidity solutions at Goldman Sachs Asset Management, warned that the November numbers were noisy … The canceling of the October report makes month-on-month comparisons impossible, for example, while the truncated information-gathering process given the shutdown could have caused systematic biases in the data.” Many economists don’t expect to get a reliable read on inflation until next month when the Labor Department releases CPI numbers for December. Energy prices, driven up by sharply higher fuel oil prices, rose 4.2% in November. Excluding volatile food and energy prices, so-called core inflation rose 2.6%, compared with a 3% year-over-year gain in September and the lowest since March 2021. U.S. inflation remains stubbornly high, partly because of President Donald Trumps decision to impose double-digit taxes on imports from almost every country on earth along with targeted tariffs on specific products like steel, aluminum and autos. The presidents tariffs have so far proved less inflationary than economists feared. But they do put upward pressure on prices and complicate matters at the Fed, which is trying to decide whether to keep cutting its benchmark interest rate to support a sputtering job market or whether to hold off until inflationary pressures ease. The central bank last week decided to reduce the rate for the third time this year, but Fed officials signaled that they expect just one cut in 2026. “The Fed will instead focus on the December CPI released in mid-January, just two weeks before its next meeting, as a more accurate bellwether for inflation,” said Haigh at Goldman Sachs. Trump delivered a politically charged speech Wednesday that aired live during prime time on network television, seeking to pin the blame for economic challenges on Democrats. The speech was a rehash of his recent messaging that has so far been unable to calm public anxiety about the rising cost of groceries, housing, utilities and other basic goods. As the holiday season approaches, Americans are dipping into savings, scouring for bargains and feeling like the overall economy is sputtering, a new AP-NORC poll finds. The vast majority of U.S. adults say theyve noticed higher than usual prices for groceries, electricity and holiday gifts in recent months, according to the survey from The Associated Press-NORC Center for Public Affairs Research. Roughly half of Americans say its harder than usual to afford the things they want to give as holiday gifts, and similar numbers are delaying big purchases or cutting back on nonessential purchases more than they would normally. Trump has promised an economic boom, yet inflation has stayed elevated and the job market has weakened in the wake of his import taxes. Trumps tariffs are taking a toll on companies like Wolverine Worldwide, which makes footwear brands like Merrell and Saucony. Facing extra tariff costs of $10 million this year and $55 million in 2026, the Rockford, Michigan, company had to increase prices between 5% and 8% on some products in June, and will have to raise prices again next year. Its put a freeze on hiring and capital investments. The company is getting squeezed even as it diversifies its sourcing network away from China, which now makes less than 10% of its products. During Trumps first term, Wolverine shifted production to Vietnam. Now its moving to Bangladesh, Cambodia and Indonesia. The problem isnt just the cost of the tariffs. Its the uncertainty caused by the unpredictable way that Trump rolls them out. From a business leaders perspective, its one thing if theres bad news, said Wolverine CEO Christopher Hufnagel. Just tell me what the bad news is, and Ill go work to try to solve for it. Its the uncertainty of how it actually plays out that causes so much trouble because then were modeling all these different scenarios and it seems like things can change in the middle of the night. Paul Wiseman and Anne D’Innocenzio, AP business writers
Category:
E-Commerce
Christmas is coming, and our bank accounts are getting, well, obliterated. But luckily, it’s no longer just your quirky aunt who appreciates a good secondhand store: Shopping for gently used items, especially during the holidays, is now on trend. And if you get on board, you might be able to save a bundle by swapping your mall run for a day of thrifting. In recent years, “Thriftmas”or shopping for Christmas gifts at stores like Good Will, The Salvation Army, Savers, and online platforms that sell used itemshas been creeping into the mainstream. And this year is no different. According to global data from online store ThredUp, in 2025, shoppers plan to dedicate nearly 40% of their holiday budgets to secondhand giftsa pretty significant jump, even from last year alone. And in 2025, the U.S. secondhand market is worth an estimated $56 billion, up 14.3% from in 2024. Why the trend? For starters, Gen Z loves all things vintage, whether it’s Polaroid cameras, a pair of flares, or iPods. So it makes sense that thrifting is gaining traction, especially among younger generations. A new survey from Affirm found that 24% of Gen Zers chose to thrift or DIY their home decor, while 40% blend new with secondhand; and 23% shopped for secondhand clothes while 35% mixed thrifted with new clothing. Of course, it’s not just vintage-loving young people, but escalating financial worries that are driving the trend, too: 85% of shoppers say they expect gifts and other holiday-related items to cost more this year due to Trump’s tariffs, per the National Retail Federation. Likewise, 84% of consumers expect to cut back on overall spending due to rising prices and economic pressure, per PwC Holiday Outlook. However, Americans are hooked on gifts. While nearly two-thirds (63%) say they wish their family traditions were less focused on gifts, only one in five are considering giving less. The art of Thriftmas Enter: Thriftmas, which looks a bit different from hitting up Target, Hollister, and Home Goods. And it might take some warming up to, if you’ve never been big on shopping secondhand. However, your wallet will thank you. And popular influencers, who are pretty skilled at breathing new life into old things, are driving the movement with content about how to do Thriftmas right. They make choosing items at the thrift store to givesometimes along with something homemade like butter or baked goods, or with something newlook like an absolute art. Rebecca Miller, an expert secondhand shopper based in Northeast Ohio, runs the popular Instagram account My Thrifted Abode. Miller tells Fast Company that even though thrifting is majorly on trend in modern times, it’s not new to her. “Thrifting has always been a part of my life,” says Miller. “I grew up in a family where money was tight at times. I remember going to auctions and thrift stores with my mom as a little girl. Its been a way of life for me for as long as I can remember.” Miller has only been sharing her thrift store finds for two years, but her Instagram already has over 114,000 followers, and there’s a reason why: She’s a talented thrifter who is skilled at teaching her audience how to thrift and gift. And according to her, people are more interested in thrifting because they are fed up with the holiday gift-giving craze and are seeking more sustainable options. “Theres been more of a light shed on the massive overconsumption issue we have,” she says, adding that the sheer amount of items that are bought new, then quickly disposed of is “truly concerning.” She’s not wrong: 11.3 million tons of textile waste end up in landfills yearly in the U.S., accounting for 7.7% of all landfill waste. During the holidays, the waste multiplies exponentially. Retailers say that 25% of returns end up being tossed out, leading to an extra 5.8 billion pounds of landfill wastemerely from returned items, not to mention all of the other holiday trash. A more personal (and very vintage) touch Miller says thrifting can contribute to a holiday season that’s more environmentally friendly, sustainable, and cheaper. But it’s not just about affordability. It’s about a more personal touch that puts genuine thought back into the holidays. “I love giving old things a new life and being a part of that items history,” she explains, noting that reimagining how to use old items scratches her “creative itch.” Taking a look at some of the fun and eclectic ways that Miller has styled items, it’s clear that it requires a bit more effort than clicking the “Buy Now” button on Amazon and slapping a bow on it the next day. In a recent video, Miller showed off adorable baskets for kids, with secondhand puzzles, books, and more. “I always thrift gifts for my kids for their birthday and Christmas, and let me tell you, it does not make a difference to them whether they are new items or not!” she wrote in the caption. But it’s likely not just kids who wouldn’t mind a thrifted giftespecially because the items don’t look like the things everyone else has. They’re vintage, unique, and require searching. “Its such a thrill to walk into a thrift store, full of junk, and never knowing what treasures youll find,” says Miller. “Theres nothing like the thrill of the hunt.” While many Americans will still flock to shop the big brands this season, it’s tough to miss that Thriftmas is about to show up in more homes than ever. And with influencers and Gen Z driving the trend, it feels about as welcomed as Santa sliding down the chimney with his bag of tricks. This year, it’s all about Thriftmasand it’s just as merry.
Category:
E-Commerce
All news |
||||||||||||||||||
|
||||||||||||||||||