The Associated Press
NEW YORK — Small businesses face a mix of old and new challenges as another year begins. A looming recession, still high (although easing) inflation and labor woes are some of the issues carrying over from 2022. There are also new regulatory wrinkles, such as a proposed change in how to classify gig workers and more states requiring pay transparency. After three precarious pandemic years, what transpires in 2023 will make a big difference in whether small businesses across the country are able to stay afloat.
Recession worries
In some ways, the possibility of an economic recession is less of an issue for small businesses than day-to-day operations.
Nela Richardson, chief economist for payroll company ADP, said small business owners should focus on bigger issues like labor and wages.
“Recession for the most part is an academic question,” she said. “We won’t know for several months until after it happens and no one on Main Street makes that call. It’s far removed from hiring and turnover.”
Given the economic uncertainty, small businesses will have to keep a tight rein on costs and run their operations as efficiently as possible, said Ray Keating, chief economist for the Small Business & Entrepreneurship Council.
Technology can help with efficiency, Keating said, and one way to keep costs down is to cast a wider net in terms of suppliers.
Inflation
The reason businesses need to keep a firm grip on costs is inflation, which appears to have peaked last...
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