Seriously? Harry Reid Says “Regulations Don’t Kill Jobs…Not At All.”



In a recent speech, Senate Majority Leader Harry Reid claimed that excessive regulations don’t cause job losses. He even cited statistics to back up his claim. When all else fails, hang your hat on micro statistics when debating a macro issue.  Good grief.

The numbers come from the Labor Department’s Bureau of Labor Statistics (BLS), which, in cooperation from state authorities, tracks mass layoffs, defined as layoffs of 50 or more workers for 31 days or more. In each case in which such a “mass layoff” is identified, state authorities interview the employers involved, asking them (among other things) the reason for the layoffs. For the third quarter, BLS reported that 0.3 percent of respondents listed “governmental regulations/intervention” as the reason.

It appears to be a simple process, but it’s actually quite tricky. The first problem is that economic hardship does not come with labels. Employers know if their costs are rising but not necessarily whether it is due to new burdens imposed on their suppliers or other factors. They may know that they didn’t get the capital they needed but not if it was because investors had better opportunities or because of government financial rules. They will know if demand has slumped, but it’s not so clear whether it was because their product is valued less by the marketplace or because government rules choked off demand from customers. The actual causes are likely to be mixed.

But even if government interviewers could identify with precision the reasons for mass layoffs, that would tell us little about why unemployment is so high. Mass layoffs are only part of the job loss picture—job losses don’t always come 50 or more at a time. Most small businesses don’t even have 50 employees.

You can read the entire piece by James Gattuso at The Foundry, Heritage blog here.

 

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Posted on November 17, 2011, in Economy & HR and tagged , , , , , . Bookmark the permalink. Leave a comment.

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