Tuesday, November 2, 2021
November 2021 Financial Update
Welcome to fall! The fourth quarter of most companies’ fiscal years is in progress. It’s time for budget-making, for year-end purchases to fill out those deductions, and for wrapping up fiscal year projects.
The pandemic highlighted or heightened a lot of issues, two of those being wage inequality and wage stagnation, in the American workplace and business sphere. These issues are now being reflected in news stories across the country. Waves of strikes are one symptom of the issues of stagnant worker pay, benefits that don’t meet workers’ expectations, poor working conditions, and unappealing working hours. The number of labor strikes in October has led some to dub it Striketober. Meanwhile, mass resignations have led to shortages in the nation’s service industry (this also has its own name, the Great Resignation or the Big Quit). Will workers come out of this period with more power than they’ve had in decades? Some are hopeful, and there is more support for labor unions than there has been in years. However, others say that there’s more striking than organizing, which may not lead to long-term unions and other organized successful worker pushbacks.
So what do workers want? Many are pushing back against the frustration caused by well-researched decades of stagnant pay and wage inequality that have seen home and goods prices surge far ahead of pay gains. Meanwhile, CEOs have continued to increase their pay stratospherically. Before Striketober and the Big Quit this frustration could be seen in activism around increasing the minimum wage. But it’s not just about pay. Workers want better working conditions. They are tired of dealing with poor hours and poor conditions like sexual harassment. Many are also angling for the continuance of workplace flexibility in location and hours, a permanent move away from the butt-in-seat-means-productivity mentality that has characterized work for a long time. More flexibility means workers are better able to fit family and childcare responsibilities into their lives.
The American Family Plan spending bill currently being debated in Congress reflects many of these same quality of life concerns that average Americans have as well. As the Chicago Sun-Times puts it, “What Republicans label as “socialist” would simply provide American families with the kind of basic shared security that is enjoyed by families in industrial nations across the world.” Many Americans favor things like the child tax credit, paid family leave, affordable prescriptions, childcare cost support and other measures in the bill.
Going into 2022, it seems like America is trying to improve quality of life for the average middle-class American, and grappling with the fact that many that should be middle-class are now living in poverty. How that will eventually be reflected in company policies, new law and policies, and government spending is yet to be determined.
2021 Financial Calendar – November:
If you haven’t already, it’s time to think about your 2022 budget. Yes, that document that helps you plan your spending in the next year, and hopefully, keeps you on track so you can avoid overspending. Budgeting is one of the most important thing that businesses and individuals can do to save money, keep costs low, and make the most of your hard-earned dollars. Curious how to start? Make a list of the income and expenses you have had this year and maybe the year before, and base your budget off of those – many people have the same recurring income and expenses each year. Keep in mind that you should update your numbers based on any new projects that you think will come your way in the new year.
Nobember is also a good time to make any large purchases you’ve been contemplating for the end of the year which might impact your taxes – new equipment, computers, furnishings or other similar purchases.
2021 Tax Updates and Dates
Parnerships and S-Corporations with an extension, your taxes are due! For a full list including payroll tax deposit dates, see the IRS Tax Calendar.
- November 1: Pay FUTA through September, if more than $500.00.
- November 1: File Form 941 for the third quarter.
What’s Afoot in the Government
As pandemic help for businesses and individuals winds down, people are spending down their last PPP loans and using the SBA’s borrower forgiveness portal and new borrower-friendly guidelines for PPP forgiveness. Although the PPP loans genuinely helped millions of American businesses and their employees, more stories of PPP fraud keep popping up.
A new proposal designed to curtail IRS fraud and increase government revenue wants to look at bank account balances for businesses across the US. This has a lot of banks and businesses feeling nervous. It’s a controversial policy and its initial form has already been scrapped. The new proposal looks at accounts holding over $10,000 and leaves out wage earners and federal program beneficiaries.
Facebook has been in the news a lot lately, with whistleblower after whistleblower talking about how they have seriously mismanaged the customers’ private information and misused the incredible publishing power that they have. Although Facebook is taking a lot of the heat and was forced by pressure to cancel plans like Instagram Kids, it’s all of Big Tech that is coming under fire. A bipartisan (rare today) group headed by Grassley and Klobuchar intends to introduce legislation to start increasing competition and reduce the abuse of power among major technology companies.
What’s Happening, in Charts
Wage inequality and wage stagnation are real things that many Americans are correctly concerned about, as the following charts show. Two of them will be reproduced here, but it is worth looking at the Economic Policy Institute’s Wage Stagnation in Nine Charts article. Covered are (1) The Cost of Inequality to Middle Class Households, (2) Wage Trends of the last three decades, (3) Wage growth of the top 1%, (4) Stagnant wages for middle-wage workers, declining wages for low-wage workers, (5) The wage and benefit plight of recent college graduates, (6) Employers are cutting health care for young workers, both college and high school graduates, (7) CEO pag grabs a larger share of wages, (8) Policy choices regarding the minimum wage fuel wage inequality and (9) The erosion of collective bargaining hurts all workers.
This chart shows that as of 2007, income should have increased another $17,867 for the typical worker to keep up with costs and inflation. Compared to the stratospheric growth of incomes at the very top tier (CEOs, etc) this is an alarming trend.
This is a chart that shows three trends that have really enraged a lot of Americans, particularly as they read more stories about and experience first-hand their own stagnant or declining wages and benefits. Other charts in this series show that the top 1%’s wages have grown 138% since 1979 and are now 296 times the typical worker’s earnings.
Business Links!
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How Top Accounting Firms Help Their Clients Sidestep Taxes
The New York Times reports on the shady business of getting rules written that benefit their clients.
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John Deere Strike Shows the Labor Market Is Ready to Pop
The power balance between employers and employees is shifting as the circumstances around the pandemic begin to ease.
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Biden’s Proposal to Empower I.R.S. Rattles Banks and Their Customer
The new proposal would require banks to report on customer balances to help the IRS track down trillions in unpaid taxes, targeting the wealthiest taxpayers. Counter proposals would trim down the oversight.
Nonprofit Links!
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In-Person Events: Documents Associations Are Using Now
Getting back together during a fraught time - Associations Now talks about ways to ease into in-person events, mindfully.
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Ways to Offset the “Great Resignation” and Keep Staff Happy: Associations Now
48 percent of America's workforce is actively looking for a new job. How do you keep employees happy and increase job retention?
Security Links!
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The State of Consumer Data Privacy Laws in the US (And Why It Matters)
The Wirecutter reports on the state of privacy laws in the US - fragmented, incoherent, and unable to regulate the vast majority of data collection practices current right now.
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The Battle for Digital Privacy Is Reshaping the Internet
The New York Times reports on the ongoing struggle regarding privacy on the internet, centering around its biggest money-maker, targeted advertising.
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Your privacy is the price of Facebook’s monopoly
The Washington Post reports on users' sacrifice of their privacy to Facebook - even if you don't use it.
