As the Trump administration vows “massive” cuts in taxes and regulations to help businesses create more jobs in the United States, the National Association of Manufacturers (NAM) has released a new study revealing the staggering number of “operational hurdles” that its members face on a daily basis owing to the country’s current regulatory environment.
The study, called Holding Us Back: Regulation of the U.S. Manufacturing Sector, is based on extensive interviews with compliance officers, a survey of the trade group’s membership and an analysis of hundreds of specific federal regulations. Key findings include:
- Manufacturers face 297,696 restrictions on their operations from federal regulations.
- An average of 3,300 new regulations are issued each year, with between 66 and 99 of them being major, which means having an estimated impact of at least $100 million or more per annum. A few have an estimated impact of more than $1 billion in a single year.
- Together, old and new federal regulations impose annual costs in the hundreds of billions of dollars, plus or minus an order of magnitude because of uncertainty.
- 87% of manufacturers surveyed say that if compliance costs were reduced permanently and significantly, they would invest the savings on hiring, increased salaries and wages, more R&D or capital replacement.
- 94% of manufacturers surveyed say the regulatory burden has gotten higher in the last 5 years, with 72% saying “significantly higher.”
“As this study demonstrates, manufacturers work diligently to comply with regulations handed down from Washington. We believe in smart regulations that keep our communities and workplaces safe, but too often, these rules go too far or are too complex,” said NAM President and CEO Jay Timmons.
“Manufacturers want to invest more and hire more in the United States, but too often the cost of doing business—and even just functioning on a daily basis—makes that difficult.”
Timmons said his group hopes the new president “can deliver a boost to manufacturing by taking the lead on balancing our regulatory system.” And indeed, Trump seems more than eager to oblige when it comes to slashing the plethora of “out of touch federal rules” that NAM has long complained are hindering small and mid-sized firms’ success.
At a White House meeting on Monday with some of nation’s largest technology and manufacturing companies, the president told business leaders he would seek to slash regulations while maintaining protections for the environment and worker safety. “We think we can try to cut regulations by 75% — maybe more,” Trump said.
Click here to download the NAM study.