Who Benefits From Regulation Rollback?
By Heidi Shierholz and Celine McNicholas for EPI - Research on the relationship between employment and regulations generally find thatregulations have a modestly positive or neutral effect on employment. How could regulations create jobs? Though regulations sometimes reduce jobs in one area, they create jobs in another. For example, factories making lead paint shut down after regulations banning lead paint were issued in the late 1970s, but enterprises manufacturing lead-free alternatives arose in their place. And some of the older factories hired people to retool their machinery to begin manufacturing lead-free paint. Mass layoffs are not caused by regulations. “Mass layoff events” are incidents in which at least 50 unemployment insurance claims are filed against an employer during a 5-week period. According to the latest data available (2011 and 2012), employers cite regulations as the reason for mass layoffs in just a tiny share of mass layoff events—one-quarter of one percent.