Most firms haven't accelerated hiring or investments as a result of the tax-cut law enacted by Republicans last year, according to a new survey by the National Association for Business Economics (NABE).
Eighty-one percent of NABE members surveyed said the 2017 law, known as the Tax Cuts and Jobs Act, hasn't led their firms to make changes to hiring or investment plans. Previous surveys by NABE found that about two-thirds of respondents had no plans to make changes.
Survey respondents who work in the goods-producing sector — a category that includes agriculture, mining, construction and manufacturing — were most likely to say that their firms have made changes to hiring and investment due to the tax law, with 15 percent of them reporting accelerated hiring and 38 percent reporting accelerated investments.
“The 2017 Tax Cuts and Jobs Act has not broadly impacted hiring and investment plans at panelists’ firms, although panelists from the goods-producing sector do report some incidence of increased investments, and a shift toward hiring and investments from abroad to the U.S.,” NABE Business Conditions Survey Chair Sara Rutledge said Monday in the group's report on its survey.
The GOP tax law cut the corporate tax rate from 35 percent to 21 percent and created a new deduction for income of non-corporate businesses. Republicans aimed for the legislation to encourage businesses to make new investments and hire new workers.
Republicans have touted the tax law and the strong economy as they campaign for the Nov. 6 midterm elections, while Democrats have been arguing that the 2017 law helps wealthy individuals and corporations more than the middle class. Polls have found that the legislation hasn't been overwhelmingly popular among voters.
NABE also asked its members about the impact of trade-policy changes, such as President TrumpDonald TrumpFormer defense secretary Esper sues Pentagon in memoir dispute Biden celebrates start of Hanukkah Fauci says lies, threats are 'noise' MORE's tariffs and retaliatory tariffs. More than three quarters of respondents said trade-policy changes haven't affected their hiring, investment or pricing plans. Businesses in the goods-producing sector were most likely to have made changes due to trade concerns, with 46 percent of respondents at those firms reporting increased prices and 38 percent reporting delayed investments.
NABE surveyed 127 of its members, who work for private sector companies or industry trade associations, from Sept. 26 to Oct. 11.