The Issues on Plumbers’ Minds Following Another Election Cycle

From the unemployment rate to tariffs, the author looks at the things she’s thinking about and how they’ll affect her business heading into 2019

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U.S. elections are over for now. That means you either celebrate or lick your wounds, and then everyone gets to work. Usually, we have some idea of what is going to happen next.

But both sides of the aisle seem to wake up every day with the question, "What is happening in this country?" Politics are on everyone's minds — especially business owners. There is so much uncertainty in America it is hard to feel in control of the fate of your business. 

The academics call it "macroeconomic factors in the business environment." I call it the big picture stuff you can't control. I'm talking about global, national, state, and local factors that affect the way you do business. One person or organization has very little control in macroeconomics. We can all play, "If I were king for a day" but it won't change reality. That lack of control is making me itch.

As the year draws to a close, I start thinking about what we want for next year. Business planning is usually one of my favorite activities. Right now my planning has as many potholes as a major U.S. highway.

Best-laid plans often go awry because we can't control everything. It would be nice, wouldn't it? Here's what is at the top of my mind heading into 2019:

Unemployment Rates

At the time of this writing, national unemployment in the U.S. is 3.7 percent. That's what they call "effectively negative" because most of it is people job switching. Underemployment is also on a downward trend.

More specific to plumbers, according to the Bureau of Labor Statistics:

"Construction employment rose by 30,000 in October, with nearly half of the gain occurring among residential specialty trade contractors (+14,000). Over the year, construction has added 330,000 jobs."

That data shows our industry is growing strong. More specifically, home services are growing strong. But super low unemployment means there aren't many more people available to work.

Talk about a mixed bag of feelings.

Before we go any further, let me provide a disclaimer. I am not a professional political analyst. I'm just a regular person of average intelligence with a Twitter feed, trying to understand what all of this means for my business.  

I translate this unemployment stuff as: I'm going to have a heck of a time hiring next year. 

It's been difficult for some time, but it might get harder. 

Tariffs

Another disclaimer: I don't have a degree in international finance or global economics. The worst part of the tariff war — is it a war? — might be feeling too stupid to understand it. 

Here is what I do understand: 

1. A lot of our parts come from overseas, one way or another. 

2. I don't have much choice about that.

Keeping up with parts pricing is practically a full-time job. Trying to ensure we are hitting our margin is increasingly frustrating. But mostly, it's the not knowing what will happen to the supply chain over the next six months that is scaring me.

Interest Rates & Housing

Interest rates are on the rise, which means a slowdown in the housing market. That means a slowdown in new construction. That means a glut of plumbing businesses switching over to service plumbing. That means more competition for my service company.

Yet again, I'm not sophisticated enough to understand how rising interest rates will (or will not) benefit the economy as a whole. What I do understand is worrying about underbidding from guys just looking to stay busy in a slowdown period.

Health Care

When will we get some resolution on health care? We have lived in this limbo of confusion long enough. I'm tired of no one having a good answer.

The cost to renew our health care plan was painful this year. I'm not sure what to expect in the future. Will costs go up, go down, go away? Who knows?

Tax Reform

Tax reform passed, but I still have no idea what it will mean for my taxes. I'm not sure anyone does. 

If you visit IRS.gov/tax-reform it says right at the top: "The IRS is working on implementing the Tax Cuts and Jobs Act (TCJA). This major tax legislation will affect individuals, businesses, tax exempt and government entities."

This thing got signed into law in 2017 and it is still being implemented. Sure, you can go through all of the legislative details to get a feel for how the changes will affect your taxes, but until you actually file it is all theoretical. Being able to do competent tax planning would be excellent.

If these things weren't already keeping you up at night, you have my sincerest apologies. If they were, I'm sorry to say I don't have answers. With the elections over, we (for the most part) know who our elected officials are. Regardless of whether you are happy with the outcome or not, it is essential for politicians to hear your concerns as a business owner. That's all you can do, after all. 

Macroeconomic factors are not in your control. My unqualified advice? Focus on what you can control.

For the rest, take your wins and losses where you can. Hope for the best and prepare for the worst. And when in doubt, enlist the help of qualified individuals when needed to help you navigate changes. 

About the Author

Anja Smith is the managing partner of All Clear Plumbing in Greenville, South Carolina, and a writer/speaker at Tradebiz Toolbox. Smith is presenting a live marketing workshop at the 2019 WWETT Show in Indianapolis. Learn more about the workshop and how to attend at TradeBizToolBox.com.



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