Regulatory Concerns Not The Biggest Hurdle For Small Businesses
Written by Ken Gaebler
Survey of Wisconsin small business owners shows that 9 out of 10 entrepreneurs don't see regulatory compliance as their primary business challenge.
The burden of regulatory compliance is often seen as an obstacle for small business growth. Faced with large amounts of state and federal regulations, conventional wisdom says that many entrepreneurs are unable to expand their operations or launch new businesses in states featuring overly harsh regulatory climates.
But a survey of Wisconsin small business owners shows that regulatory compliance may not be the leading hindrance to small business growth. Citing a survey of 597 small business owners in the Wisconsin Regulatory Review Report, a recent article by Jessica Vanegeren in The Capital Times pointed out that only 11 percent of respondents rated state regulatory compliance as their most serious business challenge.
The survey ranked low demand for products (or services) and health insurance as the leading concerns for small companies. Regulatory compliance is still on business owners' radar with federal and state compliance ranking third and fourth, respectively. However, the takeaway for small business advocates is that regulatory concerns aren't as prohibitive to business growth as other challenges.
At the same time, Wisconsin business owners overwhelmingly support reducing regulatory requirements for small businesses. Seventy-two percent of entrepreneurs believe that the cost of compliance with state regulations exceeds the benefits that regulations provide.
Nearly half (41%) of survey respondents feel that state regulations hinder additional hiring, and 29 percent agree that compliance issues make it more difficult to launch a new company -- especially for entrepreneurs that are bootstrapping their startups.
"Regulatory changes that could have a major impact on people's lives should be done like any other changes to the law -- through legislation and individual bills with public hearings, debate and discussion that allow for proper vetting and scrutiny," said Wisconsin Assembly Minority Leader Peter Barca (D).
But as more and more states begin to examine the impact regulations have on the growth of small and large companies, it seems clear that state and federal legislatures will need to take a multi-faceted approach in creating healthy business climates -- an approach that also considers the impact non-regulatory issues have on restricting business expansion.
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