A Conversation On The Vitality Of Self-Employed Individuals To The Economy With Keith Hall, President And CEO Of The National Association For The Self-Employed

From gig workers to solo entrepreneurs, self-employed individuals make up the overwhelming majority of businesses in the U.S. economy. To give you a little perspective, small businesses comprise 99.9% of businesses in the United States. Of those small businesses, 79.7% are self-employed. According to the most recent U.S. Census data, self-employed businesses are also growing at an average rate of 3.3%, which is at least six times higher than all other types of businesses.

Sadly, the Covid-19 pandemic has hit the most vulnerable businesses the hardest financially and while self-employed businesses can be nimble, they also have very little protection. Today, 43% of self-employed and micro-business owners say they are experiencing their worst economic downturn ever. Unlike other businesses, most self-employed individuals have difficulty obtaining financing through traditional lenders, with about half using credit cards regularly to manage their business expenses.

As President and CEO of the National Association for the Self-Employed (NASE), Keith Hall oversees the country’s leading resource for the self-employed. Since 1981, the NASE has provided benefits to support entrepreneurs and drive their growth. Keith began his career as an accountant for KPMG and has worked with and on behalf of the NASE since 1991. Even with his leadership duties with the NASE, he continues to help NASE members directly with tax and financial questions on a daily basis.

I recently spoke with Keith about the growth of self-employed businesses, the impact of Covid-19 on them, and how they can remain viable during this time. I truly appreciate him taking the time to speak with me; below is a summary of our conversation.

Rhett Buttle: Can you describe how the number of self-employed individuals in the U.S. has evolved in the past 10 years?

Keith Hall: Everyone would agree that there has been a dramatic increase in the number of self-employed business owners over the last 10 years. The easiest answer ‘why’ is technology.  As technology continues to advance, it has become easier to accomplish tasks remotely which has provided so many opportunities to provide goods and services in a more efficient manner.   At the same time, bigger businesses have reduced employee costs such as health insurance, retirement plans, and other benefits by outsourcing more and more tasks which also creates more opportunities for creative self-employed business owners. All of that is true, but I still see the entrepreneurial spirit, that drive for controlling their own destiny, and the desire to create something special for themselves and their families, as the number one reason we are seeing such a dramatic growth in the number of self-employed individuals.   

Buttle: How are self-employed individuals being impacted by the Covid-19 pandemic?

Hall: The Covid-19 pandemic has obviously had a pervasive impact on all of us. That is certainly true for the self-employed community. Those small business owners with direct contact with their customers on a daily basis, including restaurants, retail shops, and personal service providers such as hairdressers, personal trainers, nail salons, etc., have been hit the worst. It is my belief that one thing that we will remember from this most scary time in our history is that THIS is when so many more small business owners learned how to meet the needs of their community with their own solutions. The pandemic has forced us to find new ways to meet customer needs and has exaggerated the outsourcing efforts of big businesses, both of which create significant opportunities for many more individuals to create their own job. 

Buttle: What effective support of self-employed individuals has there been from policymakers and other leaders (e.g., corporations, philanthropy)? What else should they be doing to help?  

Hall: I have been extremely encouraged in seeing the bipartisan efforts to help small businesses throughout this crisis. It seems like we are stuck in a time of no middle ground with both sides of the political spectrum blaming the other and each side demonizing the other. But throughout this pandemic the one common thread, the one message shared by all political pundits, is that small business is the backbone of our economy. At best, it can be considered a silver lining, but Covid has dramatically increased the awareness of that fact throughout the country. The Coronavirus Aid, Relief, and Economic Security (CARES) Act and the underlying Paycheck Protection Program (PPP) loans/grants have provided tremendous relief. And for the first time ever, the family support from income generated by the self-employed business owner was viewed on an equal stead with the wages paid by big business to their employees. Grant programs like the one at the NASE have been expanded to help even more small businesses.   Expanding those programs through either an extension of the PPP program or a new stimulus package from Congress and local organizations like the NASE continuing to provide financial assistance where possible is critical for our overall economic recovery.   

Buttle: What are the top things self-employed individuals need to think about and do to remain viable in these uncertain times?  

Hall: The first concern for all businesses, including the smallest of self-employed business owners, should be to continue concentrating on staying safe and staying healthy. That is true for their business and for the customers they serve. But at the same time, they must also stay focused on meeting the needs of those same customers and finding new ways to meet those needs safely. My wife and I talk a lot about the concept of “Don’t be stupid…but at the same time don’t be stupid!” It is critical to stay safe and stay smart but at the same time stay open and stay in business. It is my experience that the small business community is the most creative, the most intuitive, the most diverse, and powerful economic force ever imagined. As a whole, that is unimaginable power, but at its core is one small business owner finding a way to meet the needs of one customer in their community. That’s where it starts and ends. So my advice to every small business owner is to concentrate on your customer base and on that next new customer. Find new ways to meet their needs safely. That is the key to emerging from this pandemic stronger than when we went in.  

Buttle: What resources can help the self-employed during this time?  

Hall: The most important thing to keep in mind as a self-employed business owner, particularly for new small business owners, is to remember that you are not alone. There are literally millions of areas of support available as close as your computer mouse, including the NASE’s website and our Covid-19 resource center. Providing access to lending options, assistance with loan or grant applications for programs like the PPP, access to thousands of other grants programs, and access to experts to help with specific questions are all areas that should be maintained. It is very easy as a self-employed business owner to think you are out there all alone, but it just isn’t true. Organizations like the NASE, your local Chamber of Commerce, the Small Business Administration, SCORE, Small Business Development Centers, etc., etc., etc….are all set up for only one purpose, and that is to help small businesses be more successful. 

Don’t miss my earlier conversations with Ron Busby, CEO of the U.S. Black Chambers, Inc., Ramiro Cavazos, President and CEO of the U.S. Hispanic Chamber of Commerce, Chiling Tong, President and CEO of the Asian/Pacific Islander American Chamber of Commerce and Entrepreneurship, Jen Earle, National CEO of the National Association of Women Business Owners, Jill Houghton, President and CEO of Disability:IN, and Ali Noorani, President and CEO of the National Immigration Forum.