The majority of U.S. manufacturing firms are quite small. In 2021, roughly 98% of U.S. manufacturers had less than 500 employees, according to the National Association of Manufacturers, and three-quarters of firms had fewer than 20 employees.
The cost of federal regulation compliance, including Occupational Safety and Health Administration standards, falls disproportionately on smaller manufacturers, according to NAM.
Manufacturers pay $29,100 on average per employee to comply with federal regulations, nearly double the $12,800 per employee costs borne by all firms as a whole, according to a NAM October 2023 study. The burden is even greater for manufacturers with fewer than 50 employees, which incur the highest regulatory costs of all U.S. firms — an estimated $50,100 per employee per year.
