Next week, the Federal Reserve’s Open Market Committee is meeting for the last time this year to decide whether to raise interest rates or hold them steady. It’s been almost two years since the Federal Reserve started raising rates, increasing the cost of borrowing for consumers, small businesses and big corporations.

But even though the Fed’s rate hikes affect virtually every part of the economy, not everybody is affected equally. Some businesses have been relatively insulated from the effects of rising interest rates.

JAL Consulting, a public health consultancy based in Colorado, advises companies, government agencies and nonprofits on topics including health equity and emergency management.

“That might look like doing background research, interviewing with folks, and being able to pull those different areas of information into really actionable steps and recommendations,” said Jackie Laundon, JAL Consulting’s owner.

Laundon said ever since the pandemic, there’s been a lot of demand for what she does.

“There are a lot of organizations who need the expertise that I can offer them,” Laundon said. “That has meant that I have been very fortunate to be able to continue to provide for myself and to be able to sustain my business.”

Laundon said the costs her business incurs are pretty manageable. That’s because Laundon is the only employee. Her only expenses are her salary, her health insurance and her accounting software.

As a result, she’s insulated from rate hikes, because she hasn’t had to take out a single loan.

“At the end of the day, I would rather be a little bit more cautious, rather than have that debt on my books,” Laundon said.

Other businesses have insulated themselves from the Fed’s rate hikes.

“I really hate the idea of saying ‘hey, here I am, smart enough to get something right,’ but I would say prescience was a little bit closer to what was happening,” said Matt Hetrick, owner of Harmony Hospitality, a company that buys older properties and redevelops them into hotels and other businesses.

Unlike Laundon’s business, Hetrick’s requires a lot of borrowing. That means it’s really sensitive to interest rates.

“When you’re doing property development, and operations, a lot of that money is directly influenced by the Fed’s rates,” Hetrick said.

Back in 2021, Hetrick watched as inflation started picking up. He said he started getting nervous.

“I was doing a lot of reading about the last time we had this crazy amount of inflation, and how the government and the Fed adjusted to it,” Hetrick said.

Hetrick called up his lenders and renegotiated his existing debt: locking it in at low rates for eight to 10 years. So when the Fed started raising rates last year, Hetrick’s loans didn’t change.

“We’re replacing couches, we’re redoing entire properties, we’re doing exteriors and all that kind of stuff,” Hetrick said. “If we were spending the money on interest, we wouldn’t be able to make those commitments, and we’d have to defer the maintenance.”

Even businesses that are insulated from the Fed’s actions might find that higher interest rates cause their customers to spend less, said Glenn MacDonald, professor of economics and strategy at Washington University in St. Louis.

“Maybe they have student loans, mortgages, credit card debt, etc.,” MacDonald said. “They all feel poorer, and consequently tend to spend less on things.”

But consumer demand for some businesses is not very sensitive to what’s going on in the broader economy. One example? Rattlesnake Solutions, a company in the Phoenix and Tucson area that removes snakes from people’s homes, and relocates them to safe areas.

Owner Bryan Hughes said when his customers call, they’re not worried about interest rates.

“Our customers are largely driven by the behavior of the animals,” Hughes said. “The services that we have are something that most people would consider, at the time that they call us, a thing that is not really an option.”

That also means that when people need a snake removed, they probably aren’t thinking about how much it costs, either.

“We know that we could charge whatever we want for some of these,” Hughes said. “I also know that that’s just not something we’re ever going to do.”

Hughes said he spends a lot of time making sure his prices are ethical, and that he’s not taking advantage of people when they’re scared.

“That also means that whether the economy’s doing really well, whether a lot of people feel like they can pay for the services, or not, the service itself and the cost of these services, don’t really fluctuate,” Hughes said.

It also helps that rattlesnakes don’t pay much attention to the Fed, either.

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