Trump or Biden? Small business owners weigh in on who is better for business, 401(k)s

Twice as many small business owners (SBOs) believe a Trump presidency will positively impact their business more than a Biden presidency would.

This is according to a new study from retirement plan provider ShareBuilder 401(k) that showed half of 500 SBOs surveyed think the outcome of this year’s presidential election will have a real impact on improving their business, even more than lower interest rates or local government policies. The survey found one-third of SBOs think a Trump win will have the greatest positive impact on their business while 16% of SBOs believe a Biden victory will help improve their business prospects.

ShareBuilder 401(k) highlighted a notable gender difference, with male SBOs skewing 40% toward Trump and 14% toward Biden while female SBOs favor Trump by 25% and Biden by 17%.

Furthermore, SBOs are delaying many business decisions until after the election, including capital investments, hiring new employees, launching new products and services, and offering benefits to employees, the survey found.

The survey also found that the top concerns for growing their business are inflation at 61%, maintaining clients at 37%, competition from larger businesses at 33%, and the cost of labor at 26%. To manage the impacts of inflation in the past year, half of SBOs have increased prices, 23% found lower-cost vendors and 22% needed to increase employee wages. When SBOs were asked how concerned they were about the future of their business due to market volatility, 68% were at least somewhat concerned, of which 30% were extremely or very concerned.

“These findings show many small businesses feel they are on shaky ground, whether from our current political climate, inflation, or market volatility,” said Stuart Robertson, president and CEO of ShareBuilder 401(k). “Given that nearly half of Americans work for a small business, the feeling of unease could have broad implications for the economic growth for the country.”

Robertson noted 401(k) performance is unlikely to be materially impacted by either a Republican or Democratic victory in November. Presidents don’t tend to drive economic outcomes or the markets within four-year terms, although mainstream perceptions may differ, he said. Rather, the Fed has much more influence on the economy during a Presidential term and ongoing by managing the interest rate and monetary policy.

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“To give our government some well-deserved credit, our businesses run in an effective free market manner with pretty fair regulations in our country which allows them to innovate and grow,” said Robertson. “Businesses should do what’s best to grow their businesses and generate profits no matter the political outcome. This enables them to potentially expand employment opportunities, provide raises, etc. that as a whole can help all Americans’ financial situation improve.”