The Impact of Public Policies on Businesses and the Economy in Akron, OH

As an expert in economics and public policy, I have closely studied the effects of public policies in Akron, OH on businesses and the economy. Akron, located in the state of Ohio, is a city with a rich history in manufacturing and industry. However, like many other cities in the United States, Akron has faced its fair share of economic challenges over the years.

The Importance of Public Policies

Before delving into the specific impact of public policies in Akron, it is important to understand the role that public policies play in shaping the economy. Public policies are decisions made by government officials that aim to address societal issues and promote the well-being of its citizens.

These policies can take various forms, such as laws, regulations, and programs. In the context of businesses and the economy, public policies can have a significant impact. They can create a favorable environment for businesses to thrive or hinder their growth. They can also influence consumer behavior and market trends. Therefore, it is crucial for policymakers to carefully consider the potential effects of their decisions on businesses and the economy as a whole.

The Business Climate in Akron

Akron has a diverse economy with a mix of industries, including manufacturing, healthcare, education, and technology.

The city has seen significant growth in recent years, with an increase in job opportunities and a decrease in unemployment rates. However, this growth has not been without its challenges. One of the main challenges faced by businesses in Akron is the high tax burden. According to a study by the Tax Foundation, Ohio ranks 45th out of 50 states in terms of business tax climate. This can make it difficult for businesses to operate and compete with companies in other states with more favorable tax policies. Another issue that businesses in Akron face is the lack of skilled labor.

With the decline of the manufacturing industry, many workers in Akron have lost their jobs and have had to transition to other sectors. This has resulted in a shortage of skilled workers, making it challenging for businesses to find qualified employees.

The Impact of Public Policies on Businesses

One of the most significant public policies that have affected businesses in Akron is the increase in the minimum wage. In 2016, Ohio passed a law that gradually increased the minimum wage from $8.10 to $15 per hour by 2025. While this may seem like a positive change for workers, it has had a mixed impact on businesses. On one hand, businesses have had to adjust their budgets to accommodate the higher wages, which can be challenging for small businesses with limited resources. On the other hand, the increase in minimum wage has also resulted in higher consumer spending, which can benefit businesses in the long run. Another public policy that has had a significant impact on businesses in Akron is the Affordable Care Act (ACA).

The ACA, also known as Obamacare, requires businesses with 50 or more employees to provide health insurance to their employees. This has increased the cost of doing business for many companies, especially small businesses. However, the ACA has also had some positive effects on businesses. It has allowed small businesses to purchase health insurance at lower rates through the Small Business Health Options Program (SHOP). This has made it easier for small businesses to provide health insurance to their employees and attract top talent.

The Impact of Public Policies on the Economy

The economy of Akron is closely tied to its main industries, such as manufacturing and healthcare.

Therefore, any changes in public policies that affect these industries can have a significant impact on the economy as a whole. One of the most notable public policies that have affected the economy of Akron is the trade policies implemented by the federal government. The recent trade wars with China and other countries have had a direct impact on the manufacturing industry in Akron. Many businesses in this sector rely on imported materials and products, and the tariffs imposed by the government have increased their costs of production. Moreover, the decline of the manufacturing industry has also had a ripple effect on other sectors of the economy. With fewer job opportunities in this sector, there has been a decrease in consumer spending, which can negatively impact businesses in other industries.

The Role of Public Policies in Economic Recovery

While public policies can have both positive and negative effects on businesses and the economy, they also play a crucial role in economic recovery.

In times of economic downturn, governments can implement policies to stimulate growth and create jobs. For example, during the COVID-19 pandemic, the federal government implemented various policies to support businesses and individuals. The Paycheck Protection Program (PPP) provided loans to small businesses to help them keep their employees on payroll. The Economic Impact Payments (EIP) provided direct payments to individuals to stimulate consumer spending. These policies have helped many businesses in Akron stay afloat during these challenging times and have also contributed to the overall economic recovery of the city.

In Conclusion

In conclusion, public policies in Akron, OH have a significant impact on businesses and the economy. While some policies may present challenges for businesses, others can create opportunities for growth and development.

It is essential for policymakers to carefully consider the potential effects of their decisions on businesses and work towards creating a favorable environment for economic prosperity.