CINCINNATI — Inflation is the biggest concern for small business owners, according to a Bank of America report.
Nearly one in four small businesses lost revenue in 2021 and less than half are confident their local economy will improve. In one case, the pressure of inflation pushed an entrepreneur into a full-time side hustle.
On a highway somewhere between Ohio and Springfield, Missouri, Baoku Moses was steering an 18-wheel tractor-trailer full of cargo. Somehow, what he does for a living seems as complicated as the cause.
“It’s a tricky question,” he said. “(My rented studio) became too difficult to maintain without classes. I had to give up the space.”
Baoku’s Village, a wellness center offering dance, music and yoga classes in Covington, lost its space. Between the COVID-19 pandemic and inflation, the revenue needed to sustain the business that Moses took 20 years to build has disappeared.
“We started out with big classes, multiple people in each class dropping out and people coming to class and saying, hey I’ll pay you next week,” Moses said.
Michael Jones, professor of economics at the University of Cincinnati, said the United States still faces the “lingering effects” of stimulus laws passed in 2021.
“It was $2 trillion and if the supply chain can’t respond to that increase in money in the economy, that will drive prices up as well,” Jones said.
To slow spending and reverse rising prices for consumer goods, the Federal Reserve authorized the largest interest rate hike in more than two decades. Last week, President Joe Biden praised federal programs for helping Americans open 5.4 million new businesses last year.
“Thanks to the economic strategy, more and more small businesses are being created and small businesses are creating more jobs faster than ever before,” the president said at the time.
Based on the labor market and spending, however, economists see little immediate growth in store for the economy.
“Since I’ve been on the road, it’s like Americans are trying,” Moses said, “They work hard. People work hard. When you work hard, you expect to live a comfortable life, but I feel like our government, sorry to say, has lost touch with reality.”
The father of 9-year-old twins who once performed with the Cincinnati Symphony Orchestra and dreamed of building his brand of wellness resorts around the Tri-State still teaches between road trips. Moses is also part of a gang of entrepreneurs trying to hold on to their dreams while finding ways to afford them.
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