New Alabama Law Addresses Top Small Biz Concern

Date: June 14, 2016

NFIB-supported bill could help employers hire skilled workers.

New Alabama Law Addresses Top Small Biz Concern

Some employers didn’t realize it, but a new
small business tax credit rewarding well-paying job creation was passed by the
Alabama Legislature and signed into law by Gov. Robert Bentley in April.

 Ted Whitten, owner of Ted’s Plumbing, told The Anniston Star that he was unaware of the measure, but planned to take advantage
of it. NFIB/AL State Director Rosemary Elebash is hopeful the law will work
well for other small business owners as well, particularly because it is a step
toward addressing the lack of skilled labor in Alabama.

 Elebash told The Anniston Star: “We ask
[our members] a series of questions about what they think are the biggest
problems that they are facing. The typical lineup is taxes, federal rules and
regulations and other red tape, and the third one fluctuates, but for more than
a year, it has been the lack of a skilled workforce.” Employers looking to fill
higher paying jobs—such as bankers, electricians, health workers, mechanics and
plumbers—need skilled labor, which justifies the higher pay requirement for the
tax credit, she said.

The new legislation (House Bill 36) gives small
businesses a $1,500 tax credit for every employee hired and paid at least
$40,000 per year. Businesses could earn an additional $1,000 tax credit for
hiring an unemployed veteran who has been discharged within the last two years.
HB 36 is an extension of the Employment Act of 2011, which provides a $1,000
tax credit for businesses that create new jobs paying at least $10 per hour.

 “The Alabama Workforce Council and the Alabama
Small Business Commission have listened to employers,” Elebash told The Annison
Star
. “And what they’ve heard is they’re looking for those skilled and
trained who are ready to work right away. When you pay them beginning at
$40,000, you are more likely to get that. And because the cost of training is
so expensive, this credit gives them the extra bump.”

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