Hispanic Business Community in Maryland Expects Domestic Economy-Based Recovery
A positive impact of COVID-19 relief and social policies during this administration is expected.
A deeper insight of this is shown in the results of the last MDHCC’s survey.
Within the framework of the impact of the economic impact of the Coronavirus, the Maryland Hispanic Chamber of Commerce (MDHCC) surveyed Hispanic-owned businesses in the state regarding their preferences, concerns, and expectations for their companies during the next six months and policies to be executed by the incoming administration. In general terms, there is a trend to identify environmental, social, and commercial issues as main priorities for the incoming President of the USA and his team, and expectations for a recovery in the economic environment that would allow sales to improve. Details about the study are described below.
Economy and Business Environment
Government-Issued COVID-19 relief was considered by far the top priority by Maryland Hispanic companies in order to achieve better economic performance and business environment: 31% considered it the most important issue on the agenda, while 21% considered it to be the second, among a list of 10 issues. Besides, social issues like racism and equality, as well as medical
insurance were the second and fourth issues that had more mentions among a list of ten, with 15% and 10% of responses in position #1, respectively. In a purely economic sense of the matter, the third top-ranked priority was Tax Reform, with 13% of responses in position #1. “There are too many institutional limitations placed on minorities in America. We are also becoming less protected from medical costs and insurance companies denying pre-existing conditions”, explained one of the surveyed members.
Policy Requirements for a Better Performance by Companies
Regarding policy priorities for the government with the objective of improving the activities of their own business, the most relevant issue indicated by Maryland Hispanic businesses was access to capital or funding, with 24% of responses in position #1. Two other issues related to the capacity of starting or transforming a business, and making it sustainable, were the other most mentioned as top requirements: access to contracts, with 36% of responses in positions #1 and #2, and reduction of the tax burden, with 28% of responses in positions #1 and #2.
It must be noted that some other issues were mentioned as additions to those shown in the graph. These were in reference to specific tax reforms for small businesses, promoting non-profits to improve the economy, improving access to legal care, expanding business programs to all sectors instead of focusing on retail or services, and implementing additional strategies for the remaining part of the pandemic and its final waves.
Expectations for the Next Six Months
Most participants considered the economy may improve soon. Despite the burst of COVID-19’s third wave in the United States, the survey shows that the Hispanic business community of Maryland has high expectations for a domestic recovery, which is straightly related to the actions of the Federal Government. This can be considered a confirmation of an optimistic view of the response to the pandemic through an upcoming stimulus plan to be defined by the new administration, as well as an expectation for state governments to lift social distancing restrictions.
An important point that was remarked is that several businesses have made efficiency improvements in terms of structure and procedures (like digitalization and adaptation to remote work) during this year, with the objective to increase profitability as preemptive measures start to be withdrawn.
On the downside, there were cases in which the damage done by the pandemic has become structural and no significant recovery may be possible, at least in the short term. This is visible in the two final graphs, showing that hiring and investment could be frozen for a while, as companies recover their profitability.
Non-Policy Issues for Better Results in 2021
An emphasis to “increase access to contracts” adds to the main needs for 2021 recovery and draws a clear connection to domestic demand as the most relevant factor to explain expectations. For Maryland Hispanic businesses, government procurement and public investment will be key for economic recovery, while networking will stay as a key resource for achieving business goals.
Technical information: survey made to 53 representatives of Hispanic-owned businesses in the
State of Maryland, between October 23 and November 20, 2020.
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