Monday, September 22, 2014

Does Regulation = Unemployment?

Contrary to what public administration profs tell you, everybody pays the cost of regulation and the unemployed may pay most heavily in lost jobs in exchange for rather murky benefits.

The National Association of Manufacturers (NAM) released a report, “The Cost of Federal Regulation to the U.S. Economy, Manufacturing and Small Business,” slamming the Obama administration for burdensome regulations imposed by the Environment Protection Agency (EPA) and other federal regulatory agencies.

In his foreword, NAM President and CEO Jay Timmons said that the average American company pays $9,991 per employee to comply with federal rules and regulations and the average manufacturer pays almost double that amount – “$19,564 per employee per year.” He noted how small manufacturers, or companies with less than 50 employees, have regulatory costs of $34,671, or more than three times the cost of an average U.S. company.

Timmons added, “The United States needs government policies more attuned to the realities of global competition” because it is the “backbone of our nation’s economy and employs more than 12 million men and women who make things in America.” Thus, the regulatory costs per employee can translate into actual unemployment as factories struggle to make payroll despite the regulatory expense.

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