Half of Small Businesses Say Regulations are a Problem
COLUMBUS – Nearly half of small-business owners say regulations are a “very serious” or “somewhat serious” problem, a survey by the National Federation of Independent Business found.
The survey found that 25% of small employers rated regulations as a “very serious” problem and 23% said they are “somewhat serious.” Regulations are affecting businesses employing between 20 and 249 the most, the survey found, as 38% said rules were a very serious problem.
“Regulations continue to be a top concern for business owners in Ohio, ranking as the No. 2 most burdensome problem for our 25,000 members in the state,” said NFIB Ohio Legislative Director Chris Ferruso in a release. “Ohio has been a leader at the state level in requiring a business impact analysis of new and existing regulations. … Hopefully federal regulators can take a page out of Ohio’s playbook.”
The cost of regulations was most cited as the biggest regulatory problem at 28%. Among other problems are understanding how to comply at 18%, extra paperwork at 17% and time delays caused by regulations at 10%.
Other findings in the NFIB survey include:
- The volume of regulations is the largest problem for 55% of small employers compared to 37% who are most troubled by a few specific regulations coming from one or two sources.
- One-third of small employers have had a government official enter their place of business to inspect or examine their records and/or licenses or otherwise check on their compliance with some government requirement in the last 12 months. For larger small businesses, 57% were visited in the last 12 months compared to 28% for the smallest ones.
- Over the last three years, 41% of small employers have contacted a government agency for help complying with a regulation. About 19% of those were very satisfied with their experience.
- Almost one in ten small employers have been fined, sued or penalized for a regulatory violation in the last three years. Larger businesses are twice as likely to have this occur compared to smaller ones.
- Twenty percent find that regulations affecting their business have no relevance to safety or consumer protection. Thirty-one percent find them of little or no value for customers or consumers and not worth the cost of compliance.
“In simple terms, regulatory compliance uses valuable human and financial capital, which is in short supply for small employers,” said Holly Wade, research director for the federation. “Regulations drain trillions of dollars from the economy and the value of many is questionable.”
Copyright 2023 The Business Journal, Youngstown, Ohio.