Hair Care Services NAICS 812111, 812112

Oct 16, 2025 - FTC Ruling Leaves Non-Compete Enforcement to States

• According to the National Law Review, the FTC’s decision in September 2025 to leave non-compete enforcement to state law brings clarity but also complexity for hair salon owners navigating employee agreements. With over 30 states imposing varying restrictions on non-competes, ranging from full bans in places like California to strong enforcement in states like Florida, salon operators must tailor contracts to local legal standards. This is especially relevant in a high-turnover industry where stylists often move between salons or start their own businesses. As states continue to reevaluate non-compete policies, salon owners should consult legal counsel to ensure agreements remain enforceable and compliant. The ruling underscores the importance of strategic workforce planning and competitive retention practices in the evolving regulatory landscape. The FTC had proposed a ban on most non-compete agreements, which was scheduled to go into effect in September 2024, before facing multiple legal challenges to the ban.
• Consumers are signaling sustained economic unease, an outlook that may challenge discretionary sectors like hair care services, as both confidence and sentiment indexes remain at multi-year lows, with inflation and job concerns top of mind. In September 2025, the Consumer Confidence Index from the Conference Board fell to 94.2, with job optimism down (only 26.9% said jobs were “plentiful”) and inflation expectations high. Buying intentions dropped for cars and travel, while interest in homes and smartphones rose. Confidence declined across most age and income groups, especially among households earning $25,000–$35,000 and over $200,000. The consumer sentiment index held at 55 in October 2025 from the previous month, and was down 22% year-over-year, according to the University of Michigan Surveys of Consumers. Overall, the data signals cautious consumer sentiment, which could dampen spending heading into the holiday season.

• According to a report in The Root, recent tariff policy changes, including the removal of the $800 de minimis import exemption, are significantly impacting US hair salons, particularly those serving Black beauty markets. Prices for imported essentials such as synthetic braiding hair, wigs, and adhesives have surged, with some products rising over 50% since May. Salon owners face difficult choices: absorb rising costs or pass them on to clients, many of whom are increasingly price sensitive. This shift is prompting stylists to adjust pricing models and consumers to explore DIY alternatives, raising concerns about the sustainability of small braiding businesses. Some salons have modified pricing, such as charging a lower price for weave-style customers who bring their own hair. The hair salon industry, especially specialized providers, is vulnerable to global trade shifts. Tariff-driven cost increases threaten profitability, client retention, and long-term viability. Salons must reassess sourcing strategies, pricing structures, and service models to remain competitive.
• According to National Public Radio (NPR), tipped workers in the beauty industry will be able to deduct up to $25,000 in tips annually from their taxable income following a provision included in President Trump’s recently signed spending and tax package that passed Congress. After the $25,000 is met, tips will be federally taxed. Also, workers who make more than $150,000 are not eligible for the deduction. According to estimates from the White House, tipped workers are expected to save about $1,700 a year on average. The law will be phased out at the end of 2028, if not extended by Congress. Tipped work is about 2% of all US employment, according to Yale Budget Lab’s Martha Gimbel. Congress has also extended the availability of the 45B FICA tip tax credit to beauty service industry employers, which allows business owners to receive dollar-for-dollar tax credits for their portion of payroll taxes.