We know COVID is affecting tech talent, but what about the election?
As we all know, the use of the word COVID in everyday life has become as commonplace as saying good morning. The natural progression of any normal conversation is to ask if your family is safe and healthy, and once we are past that step, ask about the lockdown in your local area.
We see stock markets at an all-time high in defiance to what most of us are experiencing in our normal lives. While the Nasdaq climbs, most business owners I speak with continue to tell me how ‘tough it is out there on the street,’ and we continue to see hesitation from clients on moving forward with large projects. But what seems to get very little attention is, how the upcoming election is impacting business decisions to hire, expand, invest and move projects forward. While I was doing research for this article, I was surprised to see very little publicly available information on this issue.
I am very cautious to venture into the venomous, toxic, and divisive world that is politics. Political views aside, surely the completely opposing views of the two candidates on everything from taxes to immigration, and the continually changing opinion polls, must have an impact on decisions company Boards are making.
According to the Tax Foundation, Joe Biden’s plan is to tax long-term capital gains and dividends at an ordinary income tax rate of 39.6 percent and increase the corporate income tax rate from 21 to 28 percent. The Tax Foundation estimates that this plan will reduce GDP by 1.51 percent.
President Donald Trump plans to reduce capital gains tax from 20 to 15 percent and will hold the corporate income tax rate at 21 percent. However, the President is proposing imposing tariffs on companies that do no move jobs back to the USA from overseas locations. The President’s proposed changes would be difficult to quantify in terms of their economic impacts, but there is a significant contrast between the two candidates. Include more regulations versus less, positions on fracking, and the ‘green new deal,’ and we have a tale of two politicians.
We then have continually fluctuating opinion polls showing national polling and swing-state polling. To make matters more confusing different pollsters use different target groups including likely voters, registered voters, and adults. Add into the mix media outlets with different agendas, social media posts that are censored, fact checked, analyzed, and manipulated, and the politicizing of a pandemic, and you wonder how anyone can make any business decision past November 2020.
Recently CNBC published an article stating, ‘The 2020 U.S. presidential election is now just under three months away. Uncertainty about who will become the next President – a successful reelection campaign for President Donald Trump or change in power to Democratic Party candidate Joe Biden, who currently is ahead in the polls – has been cited as a reason for recent investor caution.’
Additionally, Bloomberg Businessweek reported, ‘A new online study finds that Republicans and Independents are twice as likely as Democrats to say they would not give their true opinion in a telephone poll question about their preference for president in the 2020 election.’ This further amplifies the uncertainty by calling into question the result of all opinion polls
I have no doubt that following the election we will see projects move forward that is currently on hold, and companies looking to increase hiring. There is no doubt that COVID continues to impact buying decisions, but let’s hope the arrival of a vaccine dampens those fears.
The impact on the tech skills gap is going to be material. In June 2019, tech unemployment was at 1.3 percent. According to Forbes, tech unemployment in January 2020 was 3 percent, in April 2020 it dropped to 2.8 percent, and in May 2020 it dropped to 2.5 percent. The impact of COVID on this sector has not been pronounced, and the unemployment rate continues to decline during the pandemic. Imagine the demand for certified tech resources once the election has passed and the COVID threat has been materially reduced. The tech storm is coming, and all this uncertainty has done is delay the inevitable precipitation. Either way, I really wish this election was over.