Sometimes industry views regulations an an "ally," such as when they set safety standards that reduce counterfeit and substandard products from the marketplace. But regulations can also hinder competitiveness by raising the cost of doing business. That's particularly problematic in an economic climate where U.S. manufacturers (including electrical) are struggling to regain their footing.
Unfortunately, while our members have a clear understanding of their annual tax bills, most don't have a good grip on the cost of regulatory compliance. Fortunately, the Competitive Enterprise Institute puts out an annual report that provides an estimate for the cost of these hidden taxes. "Ten Thousand Commandments," which estimates the cost of regulatory compliance in 2009 at almost $1.2 trillion, notes that the Code of Federal Regulations is now more than 157,000 pages long. Because of this complexity, a great deal of the burden lies with the need to hire countless attorneys, accountants, and other professionals simply to oversee the compliance process.
The report also points out the inequitable impact of federal regulations on American businesses. Because large firms already have resources on board to manage the regulatory requirements, they spend on average of 43% less than very small businesses (fewer than 20 workers) on compliance. It's a challenge to small companies that this administration — which purports to champion small business — needs to address.
The full report can be found here.