New Report Shows Regulation Is Also Hurting U.S. Manufacturing Growth

The outcome after examining the impact of federal regulations on the U.S. economy as a whole (and the manufacturing sector in particular) showed that the cumulative inflation-adjusted cost of compliance for major manufacturing-related regulations rose at an annualized rate of 7.6% since 1998 while physical volume growth rates only rose by 0.4% and while GDP growth averaged 2.2% per year.

While we might question whether this is a “report on manufacturing with a manufacturer’s wish list,” another statistic jumps out: major regulations could reduce manufacturing output by up to 6% over the next decade, with the chemicals and petroleum products sectoral output could be on average 10% lower. It shows that some $500 billion in the value of shipments could be at risk and that manufacturing exports in 2012 could be lower by 17% without the regulatory costs.

FULL REPORT

JON C. OGG