How to Succeed in Business After an Election Year
When a global pandemic, devastating wildfires, and murder hornets are only a few of the top news stories, you know it’s no ordinary year. On top of all the economic, social, and environmental challenges businesses have faced this year, we’re also closing in on a national election. How will that impact your business?
While this year (and this election) come with unique concerns, businesses weather elections every four years. We’ll take a look at past trends and highlight areas business owners should watch to succeed in 2020, 2021, and beyond.
How Election Years Impact Business
The stock market historically tends to respond poorly to times of great uncertainty. In times of major political or social unrest, it makes sense that people’s anxiety could reflect in economic trends, too. The S&P 500 shows a trend of volatile markets in election years where the incumbent party ultimately lost. Current polls favor former Vice President Biden over President Trump. The increase in mail-in ballots, which take longer to process and count, can also contribute to uncertainty and possible stock market volatility.
Some good news is that the same S&P 500 data indicates that markets tend to improve by 6 months after the election, whether the incumbent party wins or loses. That is of course not to say that it doesn’t matter who wins. But there’s some historic precedent to suggest that markets may settle back into a steady pattern in a matter of months, even if there’s more volatility in the period surrounding the election.
How Business Will Change After the Election
The actual economic policies a president enacts are more important to many businesses than temporary market volatility in election season. Several major aspects of business policy are up for debate. The results of which party takes command of the White House and the Senate will impact how many companies do business. Here are a few top sectors to watch.
Trade
Tariffs and the United States’ tactics in trade negotiations with China are two important issues on the table.
Healthcare
Is the next administration likelier to expand the Affordable Care Act or attempt to repeal it? Business owners would do well to keep an eye out, especially if new policies set requirements for what companies must offer employees.
Taxes
The Trump administrations’ Tax Cuts and Jobs Act reduced corporate taxes from 35% to 21%. Biden has proposed a plan to raise corporate taxes to 28%, although he would likely depend on a Democrat-controlled Senate to pass his plan.
Minimum wage
Both candidates have expressed at least some support for an increased minimum wage, but they differ on whether this change should come from the federal government or be decided by individual states.
Economic stimulus and pandemic relief
Businesses and individuals are eager to know what aid they can expect from the government to overcome the financial impact of the coronavirus crisis.
One note to keep in mind is that this is an especially tumultuous year on several fronts. Political and social divides feel more stark than in many past elections. There’s been questions about how to ensure voting is safe, legal, and fair. There’s even been uncertainty about whether both parties will accept the outcome of the election. Protests are a distinct possibility no matter which candidate comes out victorious. Not to mention that the pandemic and the related economic instability continues to make daily business operations unusually challenging.
All of these factors mean it’s more difficult than usual to predict what businesses can expect to face in coming months.
How to Prepare as a Business to Grow After an Election Year
While you can’t control the outcome of an election, you can take action early to put your business in a good position for success.
Prioritize your website
Businesses that aren’t prioritizing their online presence are well behind the curve. Online business is an important segment of the market. Especially after 2020 has made many people leery of excessive face-to-face interaction, it’s important to have a well-managed virtual experience.
Update and automate internal processes
One result of the pandemic is a huge increase in remote work. Keep operations flowing smoothly with software solutions you can access from anywhere. Automating as much as possible makes coordinating updates quick and easy.
Adopt a resilient mindset
Whatever happens politically, we’re unlikely to wake up on November 4 or January 21 in a completely different world. We’ll still be navigating a world affected by pandemic for quite some time, for example. The businesses with the best chance of success are the ones already seeking innovative new practices and solutions that meet the “new normal.”
Check in with your people
What problems are top of mind for your clients, and how can you solve them? If you’ve returned to travel, what accommodations do your business travelers need to travel safely and perform at their best? Now is a great time to see how you can use your resources to best effect for both employee morale and retention, and customer engagement and loyalty.
In Summary
The news cycle can get overwhelming in an election year, and it’s true that you can’t predict every possible outcome. Still, that doesn’t mean you should sit back and wait to see what happens. Business owners can take action now so they’re best poised to anticipate and overcome challenges and use new opportunities effectively.
