Beyond Zoom; Where the Rocket Stops

Why has it become increasingly difficult for small businesses to achieve their goals?

What is holding small businesses back? A recent study by the Competitive Enterprise Institute (CEI), as reported in the Wall Street Journal, supplies at least part of the answer. CEI reports that federal regulations now impose $1.9 trillion of annual cost on the U.S. economy – a staggering $15,000 per U.S. household per year. This regulatory burden, according to CEI, has set historical records for U.S. regulatory burden creation in six of the seven years of the current federal administration. This regulatory burden takes an especially hard swing at small businesses. Why is this the case you ask?

Regulatory compliance has a high fixed cost and a low marginal cost, and big companies are able to spread this cost across more revenue and more employment than small companies. Therefore, the cost of compliance is much higher per employee and per dollar of revenue for small businesses. It is no surprise, then, that for April 2016 the U.S. Department of Labor reported modest job growth and a shrinking U.S. labor force.

What can you do to succeed in this hostile environment?

We at Hage & Hage have both the legal expertise and the entrepreneurial experience to help navigate this complex geography. Reach out to us.