Maine businesses hope for vaccines, tax and regulation relief to make it through 2021

(The Center Square) – As Maine faces continued economic difficulty amid the COVID-19 pandemic, the outlook for business recovery in 2021 will largely depend on how quickly small businesses, particularly the hospitality and service industries, receive help with finances and with vaccine distribution.

“Some economic storms can be so sudden and massive, and rare, that it is virtually impossible to get by without significant help from whatever sources are available,” David Clough, state director for Maine’s National Federation of Independent Business (NFIB), told The Center Square. “Everyone from political leaders to customers to landlords are important and typically willing partners in helping businesses survive the epic storm. Similar to natural disasters, the enormous coronavirus storm is bringing out the best in people.”

Still, recent data shows that optimism for small businesses dropped by double digits in December.

“NFIB research nationally indicates a significant percentage of small business owners are concerned about the ability to keep their businesses open in the face of prolonged restrictions,” Clough said. “No data specific to Maine is available, but to date hundreds if not over a thousand small businesses in Maine have closed or are on the verge of closing.”

Current expectations are for clear economic and public health improvements in the second half of 2021, depending on the pace of vaccine administration.

“Even after the corner is turned, small businesses will continue to be in vulnerable shape for months as they recover and regain financial strength,” Clough said.

A burst of consumer enthusiasm will be helpful as restrictions are eventually lifted, but there will be no going back to the way things were, Clough said.

“There will be a ‘new normal’ that will entail lasting changes in business operations and consumer behavior,” Clough said.

How that new normal unfolds remains to be seen.

Meanwhile, among the lessons learned from the pandemic, public officials have hopefully come to see that small businesses typically operate without a lot of cash reserves, Clough said.

“There are several reasons for this, including competitive pressures and costs imposed by government actions,” Clough said.

Even as financial recovery takes hold, don’t expect everyone is on your side, Clough said, and there could be more taxes and regulation coming out of Augusta.

“A moratorium is needed on new taxes, higher taxes, higher labor costs, more regulations and other stuff that could snuff small businesses,” Clough said. “Give businesses and the economy time to recover. There is opportunity even in times of adversity. Throughout the pandemic there are reports of how businesses are adapting, finding new ways to provide a product or service.”

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