March 5, 2021

Nervously Watching as the Economy Churns

But how has Main Street reacted to all of this and to renewed talk of a double-dip recession? The New York Times asked small-business owners around the country whether they were feeling the effects of the economic turmoil and whether they were still trying to build — or just to hang on.

Here are their comments, which have been condensed.

TOM HOEBBEL, photographer and videographer; Ithaca, N.Y. “Most people are not hiring professional photographers and video producers with their stock dividends, but the psychological impact affects how people view their current budgets. If we are headed to another recession, then nearly everyone will be closing their wallets and cutting projects. I fear that that would lead to one more person — me — entering the statistics of the unemployed.”

JACK STACK, chief executive of SRC Holdings, which makes racecar engines, home furnishings and many other products; Springfield, Mo. “We’re making moves trying to figure out what the policy makers are doing rather than based on what we should be doing for our customers. Are they going to extend the tax cuts or not? Are they going to implement changes in the estate tax or not? How will changes in health care affect capital gains? I mortgaged plants and put $11 million in the bank, paying 5 percent interest, as an insurance policy because I don’t know if there is going to be another credit crisis. I need to add another building, but I don’t know if I should lease it or buy it. I’ve also been staying up all night watching what’s going on in the Asian and U.K. markets, trying to figure out what it’s going to mean. Given what has happened over the past eight days, you can predict that consumer spending will be affected. All this despite the fact that we still have record profits.”

ELIZABETH LUNNEY, co-founder and chief executive, ABC Language Exchange, which offers group and private language lessons; New York. “I’m looking at my numbers every single day and going through the list figuring out what I’d get rid of first. So far, we’re having our best year ever, but if I see that sales start to drop 10 to 15 percent in a week and see that it’s a trend over the next two or three weeks, I’ll start cutting. The water cooler, and other extras like employee lunches, will be the first to go. After that, I’ll consider asking the staff to take pay cuts, which I prefer to layoffs. Last time, I was the first to take a pay cut. I brought my salary down to what I needed to pay rent and eat bologna.”

BILL LAMPSON, president of Lampson International, which builds and rents heavy-lift construction cranes; Kennewick, Wash. “We’ve sold a couple of big machines that we manufacture to the Chinese, for their nuclear program, and we’re presently constructing a very large machine for the Japanese for their nuclear program. But here in the United States, business has of course been down for essentially the last three years, since the late fall of 2008. We serve the general construction industry that builds nuclear power plants, bridges, stadiums. When those major projects are not going forward, there’s very little demand for our equipment. There’s just not a lot of confidence in the economy, and that, coupled with the regulatory program that’s going on and the taxes that corporations are charged at, makes it less attractive to make investments. People that have money, such as the oil companies and the mining companies and utility companies, they’re hesitant to invest in major projects.”

ELIZABETH CHARNOCK, founder of Cataphora, which makes software that analyzes Internet activity; Redwood Shores, Calif. “As economic news worsens, a small business tends to get paid later and later, if at all. I’ve learned that when the going gets tough, you’ve got to stand up for yourself and show that you’re the least likely person to be bullied — not the most, even if you’re wearing a pretty dress. We took two steps. First, we hired an ex-Army Ranger who had served in Iraq to chase down receivables — he’s got a finance degree, too. The second thing we did was let it be known that we’ll fight over a $100 invoice. We’ll call up and ask, ‘is there a reason this hasn’t been paid?’ In this economy, you have to get your teeth out and fight.”

Darren Dahl and Adriana Gardella contributed reporting.

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