coalition for
regulatory innovation

Fast Facts:

The average small-business owner spends at least $12,000 every year on regulations, and nearly one-in-three spends more than 80 hours each year dealing with federal regulation. Moreover, 14 percent of small-business owners report they spend more than 20 hours per month on federal regulation compliance. (Source: “2017 NSBA Small Business Regulations Survey,” National Small Businesses Association, 2017)


Federal regulations alone are estimated to cost the American economy as much as $1.9 trillion a year in direct costs, lost productivity, and higher prices. The costs to smaller businesses with 50 employees or fewer are nearly 20% higher than the average for all firms. (Source: Hackbarth, Sean, “How Regulations at Every Level Hold Back Small Business,” U.S. Chamber of Commerce, March 2017)


The Government Accountability Office found that between 2003 and 2010, 35 percent of major regulations and about 44 percent of nonmajor rules were issued without a public comment period. (Source: “Federal Rulemaking: Regulatory Review Processes Could be Enhanced,” United States Government Accountability Office, March 2014.)


Seventy percent of small firms say that new regulations have a very or somewhat significant impact on their plans to grow or expand their business. More than half have held off on hiring a new employee due to regulatory burdens. (Source: “2017 NSBA Small Business Regulations Survey,” National Small Businesses Association, 2017)


The number of new businesses being formed each year has been on the decline in the United States since the 1970s. The World Economic Forum’s Global Competitiveness Report ranks the United States 51 out of 140 countries based on the level of government regulation. (Source: A Smart Regulatory Process for Entrepreneurs and Small Businesses,” American Council of Capital Formation, 2017)


Federal regulations currently cost roughly $15,000 per household—more than most families spend on housing, food, education, and other essentials. In fact, if it were its own country, the $1.9 trillion total cost of compliance with federal regulations would rank among the world’s 10 largest economies. (Source: Crews, Clyde Wayne and Ryan Young, “Regulations Cost U.S. Business more than Canada’s GDP,” Fortune, 18 March 2017.)


Considering all federal regulations, all sectors of the U.S. economy and all firm sizes, federal regulations cost just less than $10,000 per employee per year in 2012 (in 2014 dollars). Small firms with fewer than 50 employees incur regulatory costs ($11,724 per employee per year) that are 17 percent greater than the average firm. (Source: “The Cost of Federal Regulation to the U.S. Economy, Manufacturing and Small Business,” National Association of Manufacturers, September 2014.)