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How the Recent Immigration Bans Could Affect Your Small Business

March 21, 2017

While many small businesses owners have welcomed the Trump administration’s promise for regulatory, tax and healthcare reforms and feel it will positively impact the ease of doing business in the U.S., for some, the recent immigration bans now top the list of political factors affecting businesses.

The U.S. Small Business Administration reports that there are 29 million small businesses in the U.S., and according to a study by the Fiscal Policy Institute, immigrant business owners make up 18 percent of them. In a country where immigrants play a large role in the overall economy, it’s no surprise that recent policy shifts regarding immigration are having an effect on small business.


New Policies Aimed at Immigrants

After a federal appeals court declined to reinstate the January travel ban, on March 15th the President issued a new order. Describing the new order as a ‘watered down’ version of the first, the President hinted that the intention behind the new ban was to hold up better in a legal environment. Now, a federal judge in Hawaii has blocked the new ban as well, hours before it was set to go into effect.

In concert with the first travel ban, Trump issued a directive to hire 10,000 new immigration officers. Citing public safety, Trump has promised to deport all illegal immigrants who were responsible for major crimes. Now that immigration enforcement has begun, it’s reportedly creating a climate of fear in the communities where immigrants live, work and shop.

In California, which is home to 2.3 million undocumented immigrants, it’s taking a toll on small businesses, where undocumented workers worry that even minor infractions could result in deportation. In a bid to protect immigrants and ease fears, some cities have voted to decriminalize minor offenses, such as street vendors and food trucks.


What is the Impact on Small Business?

In a survey conducted by Yahoo Aabaco, small businesses polled were split fairly evenly on whether Trump’s policies would have a positive or negative effect on them. 52 percent of small businesses worried that Trump’s policies on trade and immigration would hurt business. In a prime example of political factors affecting business, some small businesses reported a drop in sales that began shortly after the President took office. Others have had to lay off workers to deal with the decline in business, and some shared anecdotes of merchants having sales drop by 20 percent.

However, 48 percent of businesses still felt that the new tax policies and repealing the Affordable Health Care would ease the burden small businesses carry.


New Regulations for Small Business

While many small businesses have responded positively to the new administration’s regulatory reforms and applaud the intention to clear the way for small business success, still many are less enthusiastic about recent political factors affecting business. The proposed immigration and trade policies are chief among the concerns voiced by small businesses that worry about the added costs to doing business. An article in USA Today noted that in 2010, immigrant business owners were responsible for 15% of all business revenue in the U.S., which translated into $121.2 billion. With numbers like those, it’s not surprising that immigration topics translate into small business issues.

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