Business Update – September 29 2021
The legal cannabis industry has been absorbing furloughed, laid-off, and disenchanted retail and restaurant workers at a rapid pace throughout the pandemic. An estimated 321,000 people in the U.S. work in the industry, more than work as dentists, paramedics, or electrical engineers. Burnout, overwork, and challenges with unhappy customers in retail during the pandemic are driving many to seek out work in an industry with a growing reputation for treating its workers well. Many are finding better pay, more consistent hours, improved benefits, and more opportunities for advancement than in their previous positions.
THE AMERICAN RECOVERY PLAN ACT (ARPA)
Monthly Child Tax Credit Payments
What are parents doing with their advance Child Tax Credit payments? Research by data aggregation company Envestnet indicates that parents earning up to $50,000 have largely been saving and investing the extra money. This is a change from spending patterns in the summer of 2020 when stimulus payments drove a surge in discretionary spending. Families today are more likely to use the money to pay their credit cards, insurance, mortgages, or rent.
The IRS is working to resolve the technical error that delayed September payments for many families. Families who had recently updated their banking information and mailing address with the Child Tax Update Portal were most impacted. If you have not yet received your payment, check the portal regularly, ensure the IRS has your income and personal information, and be aware that the IRS may change your payments.
As a reminder, if you want to opt out of future payments, you must opt out by the deadline for the next month’s payment. Check out the IRS FAQs where you’ll find everything you need to know about opting out in Section J.
Have you been receiving confusing and erroneous letters from the IRS? You’re not alone, according to a recent report from the Tax Inspector General for Tax Administration (TIGTA). The report looked at how well the IRS dealt with the challenges of the pandemic and its People First Initiative. TIGTA found that in the spring and early summer of 2020, the IRS sent out nearly 90,000 premature tax collection notices for taxes that were not actually yet due because of the COVID-19 extension for filing and payment to July 15, 2020. These notices were sent out erroneously because the IRS had not updated its usual process of mailing out collection notices for tax returns not received by April 15 of each year. While the IRS did include explanatory inserts in the envelopes notifying taxpayers that the notice may not have been correct, the incorrect notices caused confusion for many taxpayers and their advisors.
THE GREAT REASSESSMENT
Succeeding in many companies is often equated with a promotion to management. But as a thoughtful essay from Ed Zitron in The Atlantic explains, this measure of success may become meaningless in a remote future of work. The existing model generally requires that new employees work long hours with little mentorship with the expectation that the best performers will be promoted to management positions, regardless of their ability to be effective managers. Zitron suggests that a better path forward may be to emulate the model of sports franchises that carefully nurture talent to help people excel at their role: “A great manager (like a great coach) can take a good worker and make them great, or take an average worker and make them good.” Zitron suggests reducing the bureaucracy of multiple layers of management by shifting the emphasis from controlling team members to guiding those team members to become the best they can be.
Companies with cultures that emphasize connection and empowerment in their workforces will likely have less impact from the “Great Resignation” according to management consultant Michael Stallard, who shares strategies for building a connected, empowered, and cohesive workforce. For example, keeping the organization’s vision in the forefront keeps everyone connected to and working towards that vision. Leaders who show they care about team members by asking about their personal lives can improve cooperation while reducing back-stabbing. Supporting employees in achieving their career goals can help them to do their best work.
With headlines announcing a record 10.9 million job openings with 8.4 million people seeking jobs, it should be relatively easy for job seekers to find new positions. However, that’s not the reality for many seeking new positions. Millions of those openings are for low-paying, labor-intensive jobs lacking benefits or are for part-time only positions, which may be rejected by those who left better-paying, full-time positions. A mismatch between skills and desires of prospective employees and the skills and offerings of employers is also contributing. Many people would prefer to continue working remotely, while many employers want workers back in the office. In addition, the rapid pace of technology changes can quickly lead to obsolete skills if people do not keep up with the latest software. Overreliance on software to screen applicants may inadvertently filter out the best candidates as job descriptions become ever-more complex and detailed.
REOPENING THE OFFICE AND REMOTE WORK OPTIONS
One of the positives cited by remote workers was the reduction in interruptions from co-workers stopping by to chat. However, research indicates that those interruptions can lead to higher job satisfaction and contribute to a sense of belonging in the workplace. Developing relationships with co-workers can lead to increased engagement at work. However, it’s important to set boundaries or you may spend your days distracted rather than productive. Simple gestures like wearing headphones even if you’re not listening to music send a signal to co-workers that you need to focus on the work at hand.
Meetings in a hybrid environment were hard, but meetings in a hybrid environment can be even harder as leaders will need to ensure that both the in-person and the remote participants have opportunities to contribute meaningfully. Sharing the agenda and any handouts beforehand helps bring focus. Make sure that people in the conference room and online participants are given equal attention and opportunities for participation by adding electronic whiteboards and monitoring online chat. Keeping technology simple makes it easy to start meetings on time. Choosing technology that allows remote participants to easily follow who is speaking in the conference room can also make meetings more productive.
According to the Federal Reserve, U.S. household wealth rose to a record high of $141.7 trillion in the second quarter of 2021. Contributing factors are the increase in real estate values and stock prices.
Difficulties in finding enough workers to operate 24/7 in the busy Los Angeles and Long Beach ports is just one of the factors contributing to supply chain problems. Besides a shortage of workers, congestion at the ports from a pileup of containers makes it hard for drivers to navigate ports. Drivers can’t always find trucks or the chassis needed to transport shipping containers. With West coast warehouses full, some cargo owners are simply leaving their containers at the port as mobile storage. Moving to a 24/7 schedule at the ports and across all parts of the supply chain, including rail, trucking, and warehousing as is done in other parts of the world could alleviate the problem, but disagreements about scheduling on top of a shortage of workers have so far made that nearly impossible.
The fast-spreading delta variant of COVID-19 has slowed global economic recovery, but won’t stop it, according to the latest forecast from the Organization for Economic Cooperation and Development. Back in May, the OECD forecast that the U.S. economy would grow by 6.9% in 2021; that forecast has now been reduced to 6%. The rapid spread of the delta variant in Asian countries is contributing to shortages of manufactured goods and parts, which can lead to bottlenecks that result in shortages for retailers.
- IRS resources for stimulus payments:
- Use the Get My Payment tool to check on EIP payment status
- Eligibility and general information about Economic Impact Payments
- A list of frequently asked questions for stimulus payments
- IRS information about the Advance Child Tax Credit Payments
- Portal to update information
- A list of frequently asked questions on the advance Child Tax Credit Payments
- The best source for up-to-date and accurate health information is the Center for Disease Control (CDC)
- Entrepreneur put together a listing of free tech resources for remote work
- The Consumer Financial Protection Bureau has warnings about COVID-related scams
- Fast Company has a listing of the best productivity apps for 2020
- PC Magazine explains how to carry your vaccination card on your phone
- How to create a strong password
We sincerely hope that you and your family are well and remain well. If you have any questions or concerns, don’t hesitate to reach out to us. We are all in this together!