Breaking Through the Noise

Policy leadership in 2024

BY JAY TIMMONS

MANUFACTURERS AND BUSINESS ASSOCIATIONS should be concerned that 2024 will be anything but “business as usual.” Election years are often dominated by noise and political theater that can make it harder to keep attention on sensible policy. There are significant proposed policy challenges looming—some of which emerged in 2023 and have not yet been squared away.

That is why the leadership of the Delaware State Chamber of Commerce and its partner associations is critical. And the good news is that the formula for success is unchanged: an unwavering focus on post-partisan efforts to rally policymakers around an agenda of manufacturing competitiveness. Although politics may get messier as election season heats up, manufacturers can use this as an opportunity to get candidates to take stands on the record as champions for the policies that will help us create jobs, grow the economy, and improve the quality of life. After all, nearly everyone wants to demonstrate their support for manufacturing in America.

One serious challenge heading into 2024 is the continued fight against unbalanced regulations. There is rarely a time when manufacturers are not pushing back against regulatory overreach, but this most recent wave of regulations has been one of the worst. The National Association of Manufacturers’ (NAM) members continue reporting that the new federal regulations emerging from Washington are among the costliest, most disruptive ones they have seen in decades.

Regulatory overreach comes with seen and unseen costs that make it significantly harder for our industry to lead. The unseen costs are things like foregone opportunities to expand or acquire new capital, not being able to create new well-paying jobs, and fewer advances in research and development.

The costs we can quantify are shocking. In October, the NAM published a new analysis revealing that the overall annual cost of complying with current federal regulations exceeded $3 trillion. The average manufacturer faces compliance costs of around $29,100 per employee per year, while the burden is even greater for small U.S. manufacturers, who pay an estimated $50,100 per employee per year. The last decade of regulatory overreach has caused the burden on the manufacturing sector to balloon to larger than the economies of 29 American states.

Here is another eye-opener: These numbers are more than 25% higher, adjusted for inflation, than they were 10 years ago. And the numbers only encompass regulations added through 2022—they do not account for the regulations that came out last year or new ones under consideration.

To counter this growing onslaught, the NAM, along with members of the Council of Manufacturing Associations and the Conference of State Manufacturers Associations, launched the Manufacturers for Sensible Regulations coalition. This coalition will remain the tip of the spear in our efforts to stop costly, unbalanced regulations. We will need to continue making the case that manufacturers are not opposed to regulations; we’re opposed to regulations that are needlessly duplicative, not grounded in science or facts on the ground, and set unrealistic and unmeasurable goals.

Our efforts have made significant headway. The coalition demonstrated the real-world consequences of unbalanced regulations, motivating policymakers to slow their rollout of some mega-regulations that could seriously harm our industry—like new ozone standards—and to reduce the intrusiveness of others—like the Securities and Exchange Commission’s cybersecurity rule.

We will look to build on this progress and make the most of the coalition’s influence in the year ahead. That will mean keeping open lines of communication with key administration officials and influential lawmakers on both sides of the aisle in Congress. Most importantly, we will need to continue illustrating the impact these unbalanced regulations are having on manufacturing teams and on the people who depend on our products.

Election years can be fraught, and it may seem like an uphill battle advancing policy when political theater is in full swing. Yet retiring policymakers looking to secure their legacy, those seeking reelection, and those hoping to win new bids for office all recognize the power of manufacturing in the U.S. to improve lives. It will be up to us to show them the way forward.

Jay Timmons is the president and CEO of the National Association of Manufacturers. To learn more about the NAM’s research and Manufacturers for Sensible Regulations, including ways to get involved, visit nam.org/competing-to-win/cost-of-regulations.