Small Business Facts
Small businesses have generated 64 percent of net new jobs over the past 15 years and employ just over half of all private sector employees. (Source: Small Business Administration)
Small businesses pay 44 percent of total U.S. private payroll and create more than half of the nonfarm private gross domestic product (GDP). (Source:Small Business Administration)
Government regulations are regularly cited in NFIB’s surveys as one of the top three concerns for small business owners, according to NFIB’s Small Business Optimism Index.
Number and Volume of Regulations
Today, there are 4,062 federal regulations in the pipeline. (Source: The Office of Information and Regulatory Affairs, Unified Agenda 2012)
There are currently over 400 federal regulations, which directly impact small businesses. (Source: The Office of Information and Regulatory Affairs)
The Administration posted 6,125 regulations and notices – an average of 68 a day – over a 90 day period, according to a recent CNS News Report.
In 2012, the EPA’s paperwork, alone, took 176.2 million hours and $2.4 billion –a 30 million hour increase in the past 4 years. (Source: American Action Forum)
According to the Manufacturers Alliance for Productivity and Innovation (MAPI), it cost the U.S. economy between $256 billion and $726 billion to comply with “major” regulations –those with an estimated cost greater than $100 million. (Source: Manufacturers Alliance for Productivity)
According to a recent GAO report, over one-third of major rules (those costing $100 million or more) between 2003 to 2010 did not go through public review and input, despite federal requirements for public comment. (Source: GAO Report)
40% of companies say policy uncertainty in Washington is preventing them from investments and job creation, according to a Morgan Stanley survey. (“Fearing an Impasse in Congress, Industry Cuts Spending,” The New York Times, 8/5/12)
Three quarters (74%) of voters throughout the country believe that businesses and consumers are over-regulated. Further, another two thirds (67%) believe that regulations have increased over the past few years. (Source: Public Notice, MEMO: National poll on government regulations” by The Tarrance Group, 9/12/11 )
Three out of four Americans would prefer that the government focus on creating jobs instead of new rules and regulations. (Source: Small Businesses for Sensible Regulations Survey, 2/21/12)
Since 2005, there has been a 60 percent increase in pending federal regulations that are defined as “major” or “economically significant” – costing the economy $100 million or more. There were 224 “economically significant” rules issued last year, an increase of 22 percent over 2009. This represents the highest number recorded since the government kept count. (Federal Regulation: A Review of Legislative Proposals, Part I, Senator Rob Portman’s Statement, June 23, 2011, page 2.)
Since 1976, the number of pages of environmental regulations in the Code of Federal Regulations has increased 25 fold, from around 1,000 pages to 25,000 pages. (Info-Graphic: EPA Outlier in Federal Regulations, William O’Keefe, Fuel Fix, January 26, 2011.)
The U.S. Environmental Protection Agency (EPA) has more than 330 regulations under consideration today impacting everything from farm and construction dust to CO2 emissions from schools and hospitals. (Office of Management and Budget, Current Unified Agenda of Regulatory and Deregulatory Actions, pick drop down option-EPA)
The Obama administration has finalized 193 “economically significant” rules (costing the economy $100 million or more) since 2009, nearly a 40% increase in major regulations finalized by the Bush administration’s last three years. (Source: Unified Agendas for Spring ’07 – Spring ‘09 and Fall ’09 – Fall ‘11)
In its 2011 report to Congress, OIRA reported that the estimated cost of federal regulations under Obama from Jan. 20, 2009, (when he took office) to the end of the 2010 fiscal year was somewhere between $8 billion and $16.5 billion. During the same initial stretch under Bush, the estimated cost of new regulations was between $1.3 billion and $3.4 billion. (Source: FactCheck.org, 12/22/11, “Cherry-picking on Regulation”)
The cost of new regulations issued in the first six years of Bush’s administration — ranging from a midpoint of $1.3 billion in 2002 to a midpoint of nearly $5 billion in 2005 — was far below the average of $7 billion a year under Obama. (Source: FactCheck.org, 12/22/11, “Cherry-picking on Regulation”)
President Obama’s proposed budget request for regulatory activities in Fiscal Year 2013 was $58.7 Billion, compared to $2.8 Billion in 1960. (Source: “Growth in Regulators’ Budget Slowed by Fiscal Stalemate: An Analysis of the U.S. Budget for Fiscal Years 2012 and 2013,” by Susan Dudley & Melinda Warren, The George Washington University and Washington University in St. Louis)
In 2012 there were 283,615 full-time government employees dedicated to drafting and enforcing regulations, while fewer than 50 employees at OMB are responsible for reviewing the new regulatory mandates to ensure they are justified and accurate prior to implementation (Source: “Growth in Regulators’ Budget Slowed by Fiscal Stalemate: An Analysis of the U.S. Budget for Fiscal Years 2012 and 2013,” by Susan Dudley & Melinda Warren, The George Washington University and Washington University in St. Louis)
Impact of Regulations
In January, Small Business Economic Trends reported that red tape is the second most important problem facing small business owners. (Source: National Federation of Independent Businesses)
According to a National Federation of Independent Businesses study, 3 of the top 5 problems with small businesses have to do with regulatory uncertainty. (Source: National Federation of Independent Businesses)
Small business owners in America say complying with federal regulations is the most important problem facing them today. (Gov’t Regulations at Top of Small – Business Owner’s Problem List, Gallup, 10/24/11)
Nearly half of small-business owners surveyed point to potential healthcare costs (48%) and government regulations (46%) as reasons for not hiring new employees. (Source: Gallup Poll, 2/15/12)
GW’s Regulatory Studies Center found that the cost of regulatory rules in 2012 under President Obama exceeded the cost of all rules in “the entire first terms of Presidents Bush and Clinton, combined.” (Source: GW’s Regulatory Studies Center, April 2013)
63 percent of Americans believe rules issued over the last five years have done more to hurt than to help the small business community. (Source: Small Businesses for Sensible Regulations Survey, 2/21/12)
By 2014, heightened EPA regulations will cost the nation between 476,000 to 1,400,000 jobs and $47 billion to $141 billion in GDP, according to the American Council for Capital Formation. (The Impact of EPA Regulation of GHGs under the Clean Air Act on U.S. Investment and Job Growth, Dr. Margo Thorning, American Council for Capital Formation, February 9, 2011)
According to the Small Business Administration’s Office of Advocacy, compliance with federal environmental regulations costs small firms 364 percent more than large firms. (September 2010 – The Impact of Regulatory Costs on Small Firms, Nicole V. Crain and W. Mark Crain, Office of Advocacy-US Small Business Administration.)
On a per employee basis, it costs small firms with less than 20 employees, $2,830 more than those with 500 or more employees to comply with government regulations.( September 2010 – The Impact of Regulatory Costs on Small Firms, Nicole V. Crain and W. Mark Crain, Office of Advocacy-US Small Business Administration.)