Since he swept to victory in the US elections in November, there’s been a scramble on to figure out exactly what the impact of a Donald Trump presidency might be on numerous core areas of policy. The wildly disparate headlines and predictions – swinging from gloomy to upbeat, depending on the publication carrying them – have of course tended to focus on the most hotly contested issues of the election campaign, and in particular on immigration, taxes and climate change.
But what might the knock-on effect of Trump’s cornerstone policies be for businesses looking to get up and running in the coming years – and what impact might it have on their chances to flourish in this uncertain new era? We’ve picked out three particularly hot potatoes that all new startups launching under a Trump administration would be well advised to keep an eye on:
Immigration and Foreign Workers
This could be a big deal for new or smaller businesses, and not least because of the area most commonly associated with low-overhead startups – the tech industry – is likely to bear the brunt of any Trump pressure to prioritize backyard recruitment.
Foreign workers currently make up more than 16 percent of the US workforce when both documented and non-documented employees are taken into account. Of the fully legal and documented proportion, a great many work in the tech industry, thanks largely to Silicon Valley’s decades-long commitment to attracting the best and brightest minds available, regardless of nationality.
You needn’t look far to find some very high-profile examples; after all, the CEOs of both Google and Microsoft are immigrants. In fact, according to data from the National Foundation for American Policy, more than half of all US startups are founded by talent from overseas. If Trump does indeed seek to restrict the recently expanded H-1B visa program (and possibly the temporary H-2B alongside it), American businesses could soon be facing much stiffer requirements to prove that a US national couldn’t satisfactorily fill any given vacancy.
In addition, there’s the possibility that visa restrictions could even be extended to work permits for overseas students (the J-1 visa), effectively blocking smaller businesses from cheaper recruitment of perfectly legal non-citizens looking to support their studies with casual or part-time shift work.
Taxes and Benefits
The volume of calls for mandated paid leave in the US has been growing steadily in recent years – Hilary Clinton’s campaign championed up to 12 weeks to allow for childcare, illness or nursing a sick spouse or relative. Even Trump talked about backing a six-week version for new mothers, although as the Society for Human Resource Management points out, this has been criticized in some circles for being overtly sexist in addition to lacking any clear explanation of how it would be funded.
As a recent Time article also reminds us, broad bipartisan support for paid sick leave hasn’t shown many clear signs of being translated into actual bipartisan delivery in recent years, and the idea that Trump might push ahead with any sort of nationalized programs early on seems somewhat far-fetched.
However, a lack of any decisive action on Capitol Hill could well lead to further and faster diversification in terms of state-level initiatives: California, New Jersey and Rhode Island already operate an insurance-based system based on small wage deductions, while New York’s family leave plan begins in earnest in 2018. Significant strides are also being made in Massachusetts, New Hampshire, Oregon and Washington, leaving many hopefuls of a concrete state ruling at some point before the end of next year.
Of course, this ultimately means that any rapid proliferation of individual state policies could have a fairly significant impact on new (and particularly smaller) businesses, which may ultimately affect how and where startups across a variety of industries are located in the coming years. The result could end up looking a bit like the fairly chaotic picture we’ve seen develop across Europe in the past decade, where sick leave entitlements differ wildly from country to country without any apparent relation to GDP, average wage or industry weighting – in short, a tricky and fast-moving field to keep abreast of, but an important one for business owners nonetheless.
Broadly speaking, Trump infamously rejects most scientific evidence supporting the idea that global climate change is a man-made phenomenon that will only head in one direction without swift action.
He’s already made clear his desire to dismantle (or at the very least, move American interests and policies well away from) the Paris Agreement and to break up much of the solid foundation work laid out in recent years by the Obama government’s ongoing development of the Clean Power Plan. Trump is also still regularly called out on statements like his 2012 tweet that claimed: “the concept of global warming was created by and for the Chinese in order to make U.S. manufacturing non-competitive”.
Whatever his actual beliefs and policies – and surely he’ll be pressed hard to clarify them very early on – we do know a couple of things at this stage. Firstly, he’s stated on multiple occasions that securing healthy supplies of clean water will be a “top priority” for his administration after several of the worst drought years on record has hit western US states in quick succession.
Secondly, he won’t be able to instigate as swift a withdrawal from the Paris Agreement as his rhetoric suggests: as pointed out by French environment minister Ségolène Royale in the days following the US election, the terms of the agreement “prohibit any exit for a period of three years, plus a year-long notice period…so there will be four stable years.”
In other words, this key area of policy is very much up in the air (no pun intended) at present – and the result, at least for now, is that a number of industry leaders appear to be making pledges and plans of their own. The Guardian newspaper reported back earlier this month from the first ever Companies vs Climate Change conference in Fort Lauderdale, describing “a growing number of environmentally friendly American businesses – including major airlines and banks, as well as energy, tech and pharmaceutical companies – [that] are pushing back against the president-elect’s attempts to dismiss climate change concerns and are planning to take the lead in the drive to make the US a worldwide leader at slowing or reversing the damage.”
As we look to the next few years, deciding where a new startup will position itself on this thorniest of issues could well end up having a significant impact on how – and more importantly, with whom – future deals are built.
Ashley Fleming is a blogger, editor and marketer working in the franchising industry. He likes to share knowledge with would-be franchisees to help them choose the right business model. You can find some of his other franchising articles at the Tubz Advice Blog.