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Thursday, April 27, 2017

Strategic CSR - Jobs

To follow-up on Tuesday's Newsletter, the article in the url below investigates the accusation that excessive government regulation "kills jobs":
"It was in the early days of Ronald Reagan's campaign for president that America first started frequently hearing the term 'job-killing regulations' in response to an increasing number of environmental laws. Reagan criticized the Carter administration for doing a terrible job with the economy, and said these failures were related to Carter's 'continuing devotion to job-killing regulation.'"
Interestingly, research suggests that, while regulations can diminish economic growth and, therefore, employment in one sector or industry, the same regulation usually creates about the same number of jobs in a different/new industry:
"A factory that makes lead additives for gasoline might be shut down because regulations have banned lead additives. But new jobs will then be created at a factory that makes catalytic converters, which are emissions-control devices for cars. Some workers, then, benefit from regulation, while others lose. That doesn't mean that the losses aren't real and painful for the people who held those jobs, but the overall picture is not one that can be accurately characterized by the phrase 'job-killing.'"
Of course, with any evaluation of an economy-wife phenomenon, there is also a lot of noise to go along with the theory. While jobs are created and lost continuously, it is ideologically useful to have the crutch of "burdensome governmental regulation" to blame for run-of-the-mill business failure:
"Job loss and creation is also a normal part of any economy; some companies go out of business because their goods or services are no longer in demand, while other jobs are created as new companies emerge to fill new demands. … That doesn't mean companies don't try to blame regulations for their failures."
Take care
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Do Regulations Really Kill Jobs?
By Alana Semuels
January 19, 2017
The Atlantic